The tournament this weekend was a big success. Two of our lifters made it onto the winners platform. Our lightweight took the bronze medal and our superheavyweight took the gold.
Considering this was their first national championship that was some pretty strong lifting.
Gary, could you comment on the action here in gold? Where do you see it falling back to when a debt raise is announced? Thank you for your thoughts/opinion
Does anyone know what is the different between GLD vs PHYS?
Mr. Shalom Bernanke spoke highly of PHYS. Was he talking about owning actual physical metalS or the etf PHYS (Sprott Physical Gold Trust)? I notice the past two days, it has been lagging vs GLD.
I played soccer in my teens for many many years as a netminder, we won every year, I had tons of shutouts but what I remember and care about most is the friendships and fair play on our part.
DG.. How accurate are your shorts? (Asking about UNG) It looks to me like natgas can go more, but you've got me thinking.. What's the time line for you to stay short?
Miyagi I played soccer, too. I was a goalie, not a netminder. Haha. One day, perhaps when I catch a fly with a chopstick, I will speak of the day I was beaten 15-1. 53 shots on goal. We weren't very good and we played private high schools. Unwise.
For those that are in DGP, any concerns about the EU bank stress tests and DGP being a ETN vs a ETF? I asked on the other post regarding the lagging of DGP vs UGL, any comments?
Movax: Quite accurate (though I haven't tested them). They work better on some ETF's than others, and UNG is a good one. It is a short-term signal and has already resulted in a 1% drop the past few hours, which is all that's "required." It has no bearing on whether UNG winds up at 13 next month. For myself, I enter the trade and then when i get the head start I enter a break even stop and go for more. I usually cover when I get a tape clue (reversal, big volume decline, etc.)
I started doing weights at the age of 12/13 .and always had a Good size Going...
But today .my body can't handle the same weight ( not even close )i'm full of Aches and Pains in my Shoulders and lower Back, Even my Damn Right Knee Hurts.lol
I am mostly doing Series of Pull ups ( set of 150/200 )and Push ups(150/200) today .which helps me stay in Shape.. And i'm 44
To see you Competing with Kids , and Winning is Amazing...God Bless You, Man
In other words, you have to look at the charts and figure everything out for yourself. In other words do do your due dillagence.
If it is just something out of the clear blue like short natural gas on July 18, then take it with a grain of salt. Look it over for sure, but do not expect any miracle working.
If everyone starts talking that we are going to get energy weakness, then DG might come along on Aug. 18 with the same thing. That might align with a short into an intermediate cycle failure. You might want a safe bet to mesh with your sexier trades, that mainly just keeps you away from a lot of U.S. dollar toxicity.
DG trades are normally haphazard and do not lead toward an intermediate trend, but sometimes they get on the bandwagon.
William: Good questions. I do not count 10¢ as a head start but have no particular predetermined amount. I do not trade in a rule-like way. My "toy" trades (as opposed to when I have a strong fundamental opinion like EUO or gold right now) seek to get a good entry point. If I believe the intermediate trend is on my side I will let them run. My general attitude is that if I can get a head start on most of my trades, I can figure out the rest. It's a happy problem! Knowing when to cover (or sell on the buys) is always hard. Gary waited a little too long on silver and that hurt. Next time he will be way early and watch gold rally much higher without him. There is no "best" way to do this. You can choose an entry when you get the setup you want, but closing a position forces you to make a decision every minute you are in the trade. The asymmetry of it all cannot bee beaten. I have been tape-watching for decades and can often tell when something is about to turn---and too often (in my mind at least) turn out to be wrong.. Tough game.
I hear you 100%. I use time and sales side by side with charts to exit trades. I get a feeling of which way things are going using time and sales and try to confirm it with charting.
William Wallace, you asked whether Gary holds or sells through daily cycle corrections. Gary would suggest you hold through the upcoming d.c. correction. Gary tries to get subscribers to avoid intermediate cycle corrections only.
Personally, I loaded up in the days after Gary's call (was camping in northern Ontario when the call first came), and will hold Old Turkey now, only adding what little I have left in cash when the next daily cycle correction comes.
Gary, silver has been on a tear lately. I know you think it's a broken parabola, and I agree with you... but the current run is just getting very tempting to start considering a small short position. Perhaps a bit speculative, but I really think silver is going to tank soon. Thoughts?
I tried to trade the daily cycle during silvers run up after the Japan event. Found Gary in early March and bought at AGQ 180 or so, my first PM trade. Sold at 280 or so trying to get cute/greedy and avoid the 'scary' correction I heard people talking about. It never came, watched AGQ run to 380 in what seemed like a blink. Bought it somewhere up there in the stratosphere on a Wednesday, made good money on Thursday,gave it back Friday thought about selling before the weekend but I held on. And we all know what Monday morning looked like. I remember looking up forexpros.com on Sunday night while talking to my wife. She saw me turn white, then green. Rode it down to low 200's. Gave back everything and then some but learned a helluva lesson, one I had been warned about by Gary and the more experienced traders on this forum.
William: As a member of stockcharts I have programmed a screen with my set of variables. It scans all listed securities. The ones that fit my criteria show up on a page when I hit "Run Scan." There are often a few, some of which are flaky, some of which trade to little, and some of which don't generally behave like they should. I dig deeper into the ones that are more orderly (like FXE, UNG, SPY, etc.). It works much better with ETF's than individual stocks. If I get a ton of ETF's on my sell screen it's a good overall market tell. The last three times this happened were 2/28; 4/28; 7/6---all good times to sell or sell short.
A couple of weeks ago during one of our discussions about options I came across a colored spread sheet which showed how the option price changed over time. Since I cannot find it now, I wonder if it rings a bell for anyone who might have a link. Thanks, if you can post it!!!
MM, $SPX break under 20 dma probably means the correction of the V-shaped recovery is destined to fall to the next fib level or whereever. 20/50 crossover seems iminant, but you did not ask that.
Remember when the karate kid caught the fly with the chopsticks, and says, "Hey, I did it. I did it. I caught it." Not one of your highlights!!
Remember the 7 Count Rule.It's the 7th day the SPX Has fallin,( buts it not the golden rule )To a 61.8% Fib Hit,if it leaves any kind of Bottoming tail, it could still be part of a Bottoming Process.I would prefer to see it ,Reverse and Regain the 20 sma.i have no Position on the SPX. But a Gap up could still happen and catch Bears sleeping.
Someone asked about rare coins on the last thread. If you are looking to buy $20 gold coins in mint state 65 (MS-65), then buy the $20 Gold Eagle, as it is much rarer and more valuable than the St. Gaudens, although not as beautiful. And, make sure it is graded by PCGS. If you are wondering about pricing, you can always check Heritage Auctions. Good luck!
You know im very grateful for you sharing that with me, maybe one day I will try and tackle that myself on Stockcharts...when I have a few years under my belt like you. As of now I would have no clue what criteria to input. Thanks again my friend.
There are 23,210 (23 THOUSAND!) gold futures call options at $1600 (expiring next tues afternoon) with a notational value of $3.7 BILLION!
I've never seen numbers that high.
I don't know where gold goes in the next few days, but it is VERY likely we are at or below $1600 early next week.
If we aren't and gold runs higher through that block of options (unlikely as always, but never impossible), then it will be one heck of a move to behold.
Personally, I'm long 4x gold futures from about 1550 and holding. I'm looking for an entry to add like everybody else which I expect it in the next week or so (but to/at what level I don't know).
My guess is that 1550 will not be reached again and any pullback stops no lower than 1570 or so.
Note that Aug is a large gold contract delivery month as well (one of the reasons the call options are so high) and thus the guys in charge will want to drive gold down next week for both options expiration AND for the start of Aug delivery process.
Some strong attacks next week or near the end of this week are in the cards. The momentum today, tomorrow, and maybe wed will help to draw in some remaining weak hands to crush.
Woe to anybody buying the 10th, 11th or 12th straight up day in gold here.
You guys remember this Gann Fan Chart: i did this chart Weeks ago,anyways we are about to Get a Criss Cross Fan Hit on the 20 th (Give or Take )
at first i thought it was going to be a High, for both PM & SPX,,,Today i'm thinking We will still get a Pivot.But ,Maybe we get a High (short Term in PM) and a Low on the SPX.
Exciting Times Here.Lets see if this Chart Calls a Pivot
Russell: DGP is on my sell screen...but it got there first at 49.50! Think of the screen as super-extreme overbought. In hysterical up moves that can go on for a while. It's why I like some other clue OR a reason to believe there is no reason for the crazy rally. Then I'll short the item. The fundamentals on gold are so strong, and the likelihood of higher highs is so great, I have not sold a share. I hope we pull back because I would just by more. So...yes, it's on my sell screen, butt also...so what? I am not going to sell some to avoid a 2% two day dip and then get caught light for possible fireworks.
I am trying to figure out the SOS and BOW numbers and how they are generated. Any help appreciated. What site can that data be found on? I had heard we had some SOS in GLD today.
robert, my poker enthusiasm has been smashed to pieces with the recent shut down on full tilt, i lost 65k. well its frozen in cyberspace somewhere and i dont hold much hope for it.
"Anyone else own collectable coins? The pre-1933 Saint Gaudens graded MS-65 are extremely cheap,trading at their lowest premium to melt value ever. Beautiful, too."
i have 3 of these, very very nice coins, paid £980 each a couple days ago. gl
Remember people that expiration are next week and 90% of the time the metals are temporarily taken down--last month gold fell all the way to 1480's From Jesse's Cafe a very good blog " Gold and Silver have risen quickly to a very important resistance level. I do not yet consider this an achieved breakout.
There are strong cross currents in these markets, the global sovereign debt situation in Europe, and the less remarked situation in the domestic US, highlighted but not captured mostly by the debt ceiling debate which is more of a showpiece than a serious change and prioritization.
I suspect that if the US comes to a resolution of its troubles, for a few days at least, the markets will rally, and the metals and perhaps Treasuries will be beaten like rented mules.
However, the looming crisis in Europe, which has the banks salivating for cheap national assets, is going to continue to weigh on markets by posing systemic risk in the manner of Lehman Brothers.
And as a reminder, the August Comex Options Expiration is next week
Have you ever considered adding Volume Spread Analysis (VSA) to your toolbox? It actually nailed the silver top (climax). The symbol you see (Red & Green square) above the candle for the high at 49.82 is a selling climax indication. This condition is almost never seen and its the only possible system that could have gotten you out at or near the top.
DG, Thanks for your thoughts re DGP and technical sell signal. I'm trying to trade the IT cycle, but I can't help but try to time the daily and watch the technical signals. Since we're week 3 of a 20+ week IT cycle, I'm trying to stay old turkey. As my ability to time stinks, and there seems to be literally a whole world that is worried about currency debasement, I will try not to get too cute with buying and selling.
Very sorry to hear that. You should join the class action lawsuit if you're not already part of it. If not, let me know and I can post a link with more information. I know it names a few of the obscure owners as defendants, as well as many of the sponsored players, included Phil Ivey who supposedly owned a 5% state in FT.
Can this be a tax write off?
I still think the game has many strong years ahead. There is already talk of new poker bills which will bring on some type of new platform to the US market.
I really think FT and PS, although they did illegal things, are just getting pushed out of the market for someone else to start raking it all in.
7/26 (options expiry) is a very plausible day count for a daily cycle top.
During the blow off Jan 2008 run, we had a massive candle on 1/22/08, it marked the DCL. It was a frightening $50 drop after what had been a 20 trading day $100 move higher. (Don't forget we're talking much bigger % moves being 2008) Something similar today would be an intra-day $80 swing. (Hat tip DG for suggesting the possibility)
BTW the candle on GDX was $49.50 high, $44.85, a monster $4.65 swing. Trade the bull, prepare for the outcomes.
We get another such candle it will guarantee a massive puke. Be prepared to run head first into the depths of the decline and buy it up that same day. In the example, 5 days later gold was up $95 from the low of that day. GDX was $52!
This next 5-7 days should provide clues on what to expect out of the coming DCL.
Robert, Increasing the margin requirements was a prime example of the exchange trying to protect itself from an asset that was trading on pure emotion, terribly stretched above the 200 day moving average, and at great risk of a volatile correction.
Just because something doesn't behave like you want it to isn't confirmation of manipulation.
The fact is that silver was in a massive parabolic run. Those are not sustainable. That parabola was going to collapse whether margin requirements were raised or not. There was no way silver was gonna get through $50 on the first try.
Yes raising the margin requirement probably constricted the correction down to five days instead of five weeks but it was still going to happen either way.
Silver was in a runaway move and runaway moves usually end in a crash.
As much as you would like to believe that there is an evil cartel out there trying to prevent you from making money, it simply isn't true. If it was, the price of silver would've been capped at $25 long before it ever had a chance to reach 50.
Gotta love silver here. I won't add, but sit comfortably on my AGQ and SLV. In the mid thirties silver offered a low risk entry; above 40 however the risk is, of course, growing in leaps; yet I continue to believe that if silver won't knock out 50 this year, it'd be a bad omen for the silver bull in general. My biggest position is in DGP, followed by AGQ. I am also holding some nano cap silver miners, but only humble positions. And still holding some DAG, CORN, and AGRO. Still believe that the dollar will continue to be trading sideways for the time being without resolving to upside or downside before late September. Late September will be the game changer then, possibly with a thrust down in the dollar and a blow out top in gold, before a dollar turn around, accompanied by a sharp correction in PMs.
>> In the mid thirties silver offered a low risk entry
Sorry, Oxymoron if I ever heard one. The only reason you believe (in retrospect) that silver was low risk in the mid-$30's is that it happened to work out for you so far. Silver is the most volatile trading instrument out there second only to penny stocks. Rationalize short term gains all you want, but it's EXTREMELY risky to try to guess this one.
I for one am with Gary, broken parabolas do not behave like the current silver bulls want to think they do. We're headed for an impending massive silver correction. This is just the market's way of getting the bulls back into the trade before the floor falls out yet again.
I am wondering, can psychology & the will to lift the weight give you "extra strength", or is it in reality purely deterministic on your physical make-up?
I won the Armed Forces Europe championship back in 1969, qualified for the National Collegiate Championships in 1973 and placed 4th at the National Masters in 1987 at 40 in my age group.
At 64 I am little past my prime.
My totals were way less than Gary's. I still lift though, just no comps any more.
He does have a great blog but he is correct about expirations --h--expirations are next week on the 26th--the cartel will try its usual attack on the metals,just like they have for almost every one
My concer now is that the debt ceiling might be "resolved" without warning anytime before the deadline sending PMs and associated equities/ETF majorly downwards.
Zerohedge noted that comex has not reversed any of it's increased margin requirements for silver despite it's plunge from 50 to 32. Why would they need to further hike margins during this move?
I haven't posted in quite a while but had to jump in after seeing that Gary is repeating the same mistake that's been floating around here for a while.
In tonights report Gary states that raising the debt ceiling would mean more money printing.
Not at all.
Raising the debt ceiling means that the treasury can sell more bonds. Those bonds are sold to the public who trade their exiting money. Not new money.
Money printing only happens when the FED is involved. Currently, they are not stimulating the economy through money printing (i.e. bond purchases)
One might make a case that this opens the door for more stimulus etc... But that's a subjective opinion.
jlinks, You got to be kidding...we are not going back into this stupid debt doesn't matter debate again.
Gary,
A little concerned if gold doesn't correct soon, and I mean soon!...could be an inter-day event, but if some of the steam isn't taken out of this thing, I am getting nervous that this will be a fake rally for gold, just as the manipulated rally for stocks was. 10-11 straight up downs is crazy, what next 20 straight up days? Does anybody have a precedent for how long gold can rally in a healthy rally without a day off. Hair on the back of my neck is perking again. HAPPY TO BE REALLY WRONG!! Hopefully we correct real soon!
Keys, There is no question at this point that gold put in an intermediate low. I think gold is just setting up for the parabolic finish that we've been looking for for almost two years now.
jlinks, when (not if) the debt ceiling is raised and more bonds are issued, the Fed will have no choice but to step in and continue buying them. These asset purchases (using printed money) have been the only thing keeping US gov't borrowing costs so low. By definition, when the gov't starts issuing more bonds, there will be more money printing.
Jinks, The Fed's balance sheet has expanded by several trillion dollars and it continues to expand. The Fed is printing money and buying assets whether they announce it as QE or not and have been for over two years.
If citizens were to buy bonds then yes the Fed could drain liquidity by selling treasuries into the market. However I think there will be limited buyers at these interest rates.
In order to get anything resembling true demand I think Bond prices are going to have to fall and interest rates rise.
"The Fed's balance sheet has expanded by several trillion dollars and it continues to expand." True
"The Fed is printing money and buying assets whether they announce it as QE or not and have been for over two years." FOMC is a tool used by the FED for decades. When we are talking stimulating the economy, their plans are announced first, aka TARP, QE1, QE-light, QE2.
"If citizens were to buy bonds then yes the Fed could drain liquidity by selling treasuries into the market. However I think there will be limited buyers at these interest rates." The debt ceiling raise will allow new bonds to be sold by the treasury, not old bonds held by the FED. These new bonds will be sold on the bond market and bought with existing money, unless the FED announces new stimulus.
Simply stating that raising the debt ceiling means money printing confuses economic cause-effect.
jlinks, you are technically correct that new bond issues will not necessarily constitute new money printing. Fine, I'll grant you that. But given how low bond rates are at the moment I think Gary is correct that there will not be enough true market demand to sustain prices at current levels. That's unacceptable as far as the Fed is concerned, and they will have no choice but to step in and buy. So I think it not unreasonable to say that new bond issues will, at least indirectly, beget new money printing.
Also keep in mind the size of the Fed's balance sheet; simply rolling over the trillions in treasuries they're currently holding, which are mostly short-term, will be enough to keep a price floor in the bond market for a while.
The universal problem that most inexperienced investors have is that they try to trade around an expected correction.
I've gone back and forth with myself many times as to whether it's helpful or not to prepare people for a daily cycle correction. I suspect most people trade out of their positions and then when the market doesn't correct immediately they end up panicking back in at, or close to the short term top.
When I say I expect a correction that is not a signal to sell your positions, it's a signal to prepare to add to positions.
For all we know gold could continue higher for another 10 days and anyone that sells now could miss out on a huge rally. It's just not worth the risk of missing the upside in a bull market to try and sidestep a minor 1% or 2% pullback.
I'm keeping my promise [to myself] to do this one Old Turkey style, and I absolutely will not touch my contracts right now, but I just want to mention that the daily RSI is now maxed out.
Yes Gann. I just thought it was interesting how well it seemed to line up with the SPX cycles. I also find it interesting that the next fib line is on August 4, just two days after the scheduled debt ceiling vote. Not saying I know how to trade it.....just interesting. I would respect it as a bull or a bear.
I hope you are correct with your beliefs about gold's current IT cycle, but wouldn't you agree that the dollar still has to find its 3 year low in order for this move in gold to go parabolic?
I know! And your comparison with the $USD '08, in tonight's letter, was an eye-opener. The current formation of the USD looks almost identical to the last 3 year low.
The current intermediate cycle in the dollar is too late for an explosion. If not this daily cycle than likely the next one will begin the move down into the intermediate low.
The expectation is that the move down into the intermediate low will spur gold into a parabolic top.
Gold will certainly be a bubble one day, but it obviously isn't at the moment.
In order to be a bubble the public has to panic into an asset similar to what happened with tech stocks and housing. Go ask any of your neighbors and I bet you'll find that none of them own gold. When gold does become a bubble half of them will own gold.
If the dollar is indeed basing '08-style, that would be very ominous for gold, would it not?
My memory is that gold made marginal new highs in summer 08. I chased those highs, much as I am now, and got creamed as the dollar rallied into the meltdown.
If the dollar explodes higher, there's a strong chance that this is a false breakout.
08 was the eight year cycle low for gold the next one is due until 2016.
You probably don't have to worry about another 30% correction in gold for at least another five years.
At this point every intermediate cycle bottom should hold. The last one came in at 1478. So we should not see gold below 1478 for the rest of this bull market.
I've gone back and forth with myself many times as to whether it's helpful or not to prepare people for a daily cycle correction
clearly you warn not to trade these wiggles and to buy the dip. I like it when you prep us for a pullback. Its not scarry when it happens and buying the dip is very satisfying. Plus the ones sittting there need help getting in. the call came pretty sudden this time without the preperation beforehand like so offten. but you didnt get caught off gard, you saw it when it happened. I guess im trying to point out if someone wants to get cute that is there problem. If they want to buy a dip like they should then they need help.
My expectation: if this is parabolic C-wave the following D-wave can or will correct as much as 2/3 of the move. So if here goes to 1850, correction to 1574/1600 is within the reach.
Gary, you had mentioned a month or two ago that gold C waves in the future would not end with the sharp parabolic rises that they have in the past because of the large amount of gold held by large funds now.....that the topping process would be less of a spike but more of a rounder top. How far stretched above the 200 sma do you see future C wave tops being?
Maybe the breather in gold will come today. As I type, gold has dipped below 1600; however, we all know that these moves before the open are pretty unpredictable...
Looks like we are getting a breather today. What levels do you guys recon we are going to get? I got a order to buy at 1581.00 but maybe that's to low.
I was wondering about the role of psychology in weightlifting. You know, if the sheer will to lift the weight gives you any extra strength or is it all objectively in reality solely deterministic based on your biological condition....
i took my first pos on the last entry.. but looking to add further. think i'll add some at 10 sma and the the final once the swing low is confirmed during the daily cycle low.
once we ge our next swing low do you put your stops at that level?
Michael: Yes Jason said newsletter sentiment has risen sharply on gold, but also that that indicates coming short term weakness (1 week or so) only. Fits with a DCL low coming up.
The model portfolio is designed for the maximum number of investors. For most people 75% of their portfolio concentrated in one asset class is more than enough exposure.
If you want to take on more risk than that then adjust your position sizes accordingly.
Gary- So you are looking for an intermediate cycle dollar correction after this or next daily cycle followed by another intermediate cycle higher which runs into Oct or Nov?
I understand...you have taught me that before. I seen STRAT81 mentioned possibly using Volume Spread Analysis to spot tops, would you consider giving it a try?
People are so confused right now...I think the fact that the intermediate cycle low caught many unawares because everyone was expecting a bottom on the 150sma, and then this rally where everyone is expecting a pullback that is still to be seen...I know im losing my mind, the BOW & SOS numbers are whats keeping me sane because I see im not the only one!!
Right on Gary! Congratulations to the team.
ReplyDeleteSLV Daily Observation: http://screencast.com/t/ClsjHo4B
ReplyDeleteCongratulations Gary, you train like you trade brother!
ReplyDeleteTake the trade at 1601.50 at the lower trendline, sell now at the upper trendline at 1604.50
ReplyDeleteHard work and determination builds character and good values.
ReplyDeletePersonally I find winning/losing irrelevant.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/7/18_London_Trader_-_Potential_for_Major_Short_Covering_in_Gold.html
ReplyDelete.
ReplyDeleteGary, could you comment on the action here in gold? Where do you see it falling back to when a debt raise is announced? Thank you for your thoughts/opinion
ReplyDeleteDoes anyone know what is the different between GLD vs PHYS?
ReplyDeleteMr. Shalom Bernanke spoke highly of PHYS. Was he talking about owning actual physical metalS or the etf PHYS (Sprott Physical Gold Trust)? I notice the past two days, it has been lagging vs GLD.
Miyagisan,
ReplyDeleteI don't find winning and losing irrelevant. Good character includes the ability to lose gracefully, and perhaps more importantly, win gracefully.
Best,
Le Fou
Le Fou,
ReplyDeleteGood point, well taken.
I played soccer in my teens for many many years as a netminder, we won every year, I had tons of shutouts but what I remember and care about most is the friendships and fair play on our part.
Great work Gary. Must be very satisfying. Now you can put your feet up and watch gold rally.
ReplyDeleteThough I must say, you don't seem like the 'feet up" type :-)
Gary,
ReplyDeleteCongratulations to all those who put themselves on the line. What were the age ranges of your lifters?
Best,
Le Fou
Eamonn,
ReplyDeleteThanks for that article, what is that London trader looking at when refering to the number of short positions added, do you know?
William Wallace, no idea
ReplyDeleteAll of the guys were in their 20s except one who is 30.
ReplyDeleteI find losing irrelevant. Winning is very relevant.
ReplyDeleteE,
ReplyDeleteI'll tell you where I see gold going to in the next correction after the correction.
DG..
ReplyDeleteHow accurate are your shorts? (Asking about UNG) It looks to me like natgas can go more, but you've got me thinking..
What's the time line for you to stay short?
Miyagi I played soccer, too. I was a goalie, not a netminder. Haha. One day, perhaps when I catch a fly with a chopstick, I will speak of the day I was beaten 15-1. 53 shots on goal. We weren't very good and we played private high schools. Unwise.
ReplyDeleteGary,
ReplyDeleteDo you have any idea around when this daily cycle will top?
For those that are in DGP, any concerns about the EU bank stress tests and DGP being a ETN vs a ETF? I asked on the other post regarding the lagging of DGP vs UGL, any comments?
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteMovax: Quite accurate (though I haven't tested them). They work better on some ETF's than others, and UNG is a good one. It is a short-term signal and has already resulted in a 1% drop the past few hours, which is all that's "required." It has no bearing on whether UNG winds up at 13 next month. For myself, I enter the trade and then when i get the head start I enter a break even stop and go for more. I usually cover when I get a tape clue (reversal, big volume decline, etc.)
ReplyDeleteGary Hats Off to You
ReplyDeleteMan i dont know how you do it.
I started doing weights at the age of 12/13 .and always had a Good size Going...
But today .my body can't handle the same weight ( not even close )i'm full of Aches and Pains in my Shoulders and lower Back, Even my Damn Right Knee Hurts.lol
I am mostly doing Series of Pull ups ( set of 150/200 )and Push ups(150/200) today .which helps me stay in Shape.. And i'm 44
To see you Competing with Kids , and Winning is Amazing...God Bless You, Man
Thanks DG, I think you've helped me think of a plan I am happy with. Now I just have to stick to it.
ReplyDeleteDG,
ReplyDeleteHow much determines if you have a head start on a trade, Im assuming you dont put a stop break even when your 10 cents ahead, or do you?
And what if the trade turns south immediately, how far below do you place your stop if there is no chance to place it at break even obviously?
GLD top of SOS list.
ReplyDeleteGary,
ReplyDeleteAre we holding through daily cycle lows? Thanks strongman!
WW, that's the part you do on your own. GL
ReplyDeleteIn other words, you have to look at the charts and figure everything out for yourself. In other words do do your due dillagence.
If it is just something out of the clear blue like short natural gas on July 18, then take it with a grain of salt. Look it over for sure, but do not expect any miracle working.
If everyone starts talking that we are going to get energy weakness, then DG might come along on Aug. 18 with the same thing. That might align with a short into an intermediate cycle failure. You might want a safe bet to mesh with your sexier trades, that mainly just keeps you away from a lot of U.S. dollar toxicity.
DG trades are normally haphazard and do not lead toward an intermediate trend, but sometimes they get on the bandwagon.
Update on SPX Daily Chart: http://screencast.com/t/dxah5epRr8dz
ReplyDeleteFTW,
ReplyDeleteThats what I expect to do anyway, i was just confirming as to whether Gary holds through DCL's or not because i wasnt sure.
William: Good questions. I do not count 10¢ as a head start but have no particular predetermined amount. I do not trade in a rule-like way. My "toy" trades (as opposed to when I have a strong fundamental opinion like EUO or gold right now) seek to get a good entry point. If I believe the intermediate trend is on my side I will let them run. My general attitude is that if I can get a head start on most of my trades, I can figure out the rest. It's a happy problem! Knowing when to cover (or sell on the buys) is always hard. Gary waited a little too long on silver and that hurt. Next time he will be way early and watch gold rally much higher without him. There is no "best" way to do this. You can choose an entry when you get the setup you want, but closing a position forces you to make a decision every minute you are in the trade. The asymmetry of it all cannot bee beaten. I have been tape-watching for decades and can often tell when something is about to turn---and too often (in my mind at least) turn out to be wrong.. Tough game.
ReplyDeleteBTW: The yen just showed up on my sell screen so I bought YCS (double inverse yen) at 14.58.
ReplyDeleteThanks Gann.
ReplyDeleteStill holding cold turkey on GLD and GDX.
This comment has been removed by the author.
ReplyDelete.
ReplyDeleteGann,
ReplyDeleteIf SPX doesn't hold the 20dma, is that a bearish sign or we'd have to wait till next tag of something?
Seeing some mark em up to sell em activity in smaller less liquid stocks in the sector from market-makers.
ReplyDeleteDG,
ReplyDeleteI hear you 100%. I use time and sales side by side with charts to exit trades. I get a feeling of which way things are going using time and sales and try to confirm it with charting.
DG,
ReplyDeleteWhen you say it just showed up on your screen, what do you mean? How does that occur.
William Wallace, there's a "beep beep" and then a green flashing neon sign of the stock symbol
ReplyDeleteWilliam Wallace, you asked whether Gary holds or sells through daily cycle corrections. Gary would suggest you hold through the upcoming d.c. correction. Gary tries to get subscribers to avoid intermediate cycle corrections only.
ReplyDeletePersonally, I loaded up in the days after Gary's call (was camping in northern Ontario when the call first came), and will hold Old Turkey now, only adding what little I have left in cash when the next daily cycle correction comes.
I am trying to learn to trade less often!
I thought they are acts of God, and like a lamp will fall over for DG, and the pieces will spell out stock symbols. No? LOL,
ReplyDeleteNo, I think he's had created for himself a program of his algorithms.
Find a programmer WW, and put your mind into equations.
Eamonn,
ReplyDeleteThats what I thought....lol. But I want that little beep thingy too, how do I get me one of those DG?
KM,
Thanks
A rabbi, a priest, and a nun walk into a bar. The bar keep remarks, "Have you seen the parablic sar on the ultra short yen ETF yet"?
ReplyDelete"Yeah, really warped," moaned the rabbi.
"What was wrong with the established short on the Euro," wondered the priest outloud?
"He likes to deviate," responded the nun.
Gary, silver has been on a tear lately. I know you think it's a broken parabola, and I agree with you... but the current run is just getting very tempting to start considering a small short position. Perhaps a bit speculative, but I really think silver is going to tank soon. Thoughts?
ReplyDeleteRobert,
ReplyDeleteI did find one....DG!
Now I have to make him an offer he cant refuse!
I tried to trade the daily cycle during silvers run up after the Japan event. Found Gary in early March and bought at AGQ 180 or so, my first PM trade. Sold at 280 or so trying to get cute/greedy and avoid the 'scary' correction I heard people talking about. It never came, watched AGQ run to 380 in what seemed like a blink. Bought it somewhere up there in the stratosphere on a Wednesday, made good money on Thursday,gave it back Friday thought about selling before the weekend but I held on. And we all know what Monday morning looked like. I remember looking up forexpros.com on Sunday night while talking to my wife. She saw me turn white, then green. Rode it down to low 200's. Gave back everything and then some but learned a helluva lesson, one I had been warned about by Gary and the more experienced traders on this forum.
ReplyDeleteDon't give up the strong hand.
Not much excitement here considering gold is about to close above $1600 for the first time.
ReplyDeleteWilliam Wallace, http://www.youtube.com/watch?v=io0M05nS0wQ
ReplyDeleteWilliam: As a member of stockcharts I have programmed a screen with my set of variables. It scans all listed securities. The ones that fit my criteria show up on a page when I hit "Run Scan." There are often a few, some of which are flaky, some of which trade to little, and some of which don't generally behave like they should. I dig deeper into the ones that are more orderly (like FXE, UNG, SPY, etc.). It works much better with ETF's than individual stocks. If I get a ton of ETF's on my sell screen it's a good overall market tell. The last three times this happened were 2/28; 4/28; 7/6---all good times to sell or sell short.
ReplyDeleteIt is hard for my day-trader brain to hold on and not take profits....
ReplyDeleteMust....not...sell...yetttt....
William
ReplyDeletea 50% Retrace of a Previous Big Candle ( in this chase it;s a Big Red Candle )Should be Good Resistance Level.and it's Just shy of $40 ,on SLV..
It will be interesting to see ,What Happens from here.on the Daily Chart.
http://screencast.com/t/PYq2UyjF
A couple of weeks ago during one of our discussions about options I came across a colored spread sheet which showed how the option price changed over time. Since I cannot find it now, I wonder if it rings a bell for anyone who might have a link. Thanks, if you can post it!!!
ReplyDeleteJenny, http://www.optionsprofitcalculator.com/calculators/option_purchase.html
ReplyDeleteMM, $SPX break under 20 dma probably means the correction of the V-shaped recovery is destined to fall to the next fib level or whereever. 20/50 crossover seems iminant, but you did not ask that.
ReplyDeleteRemember when the karate kid caught the fly with the chopsticks, and says, "Hey, I did it. I did it. I caught it." Not one of your highlights!!
ftw?
ReplyDeleteThanks for the info.
I liked it when I suckered Daniel-san into waxing all my cars that I sold at an auction later. That's a good highlight.
Mr M
ReplyDeleteRemember the 7 Count Rule.It's the 7th day the SPX Has fallin,( buts it not the golden rule )To a 61.8% Fib Hit,if it leaves any kind of Bottoming tail, it could still be part of a Bottoming Process.I would prefer to see it ,Reverse and Regain the 20 sma.i have no Position on the SPX. But a Gap up could still happen and catch Bears sleeping.
Goodluck
Thanks Gann, I'm just looking at the overall market conditions here and have a small put on SPY.
ReplyDeleteAH, selling at 280 was the right move is the moral to the story. If you prefer your sanity, that is. Any last shread of sanity.
ReplyDeleteClose at days highs?
ReplyDeleteDG,
ReplyDeleteHas DGP come flashing on your sell screen? If it does, let me know.
Someone asked about rare coins on the last thread. If you are looking to buy $20 gold coins in mint state 65 (MS-65), then buy the $20 Gold Eagle, as it is much rarer and more valuable than the St. Gaudens, although not as beautiful. And, make sure it is graded by PCGS. If you are wondering about pricing, you can always check Heritage Auctions. Good luck!
ReplyDeleteÉamonn, I get a graph range listing at the site, but not the graph. Ideas?
ReplyDeleteDG,
ReplyDeleteYou know im very grateful for you sharing that with me, maybe one day I will try and tackle that myself on Stockcharts...when I have a few years under my belt like you. As of now I would have no clue what criteria to input.
Thanks again my friend.
Jenny, what options are you looking for information on? symbol/call/put/strike/expiry/number of contracts ?
ReplyDeleteGann,
ReplyDeleteThanks, I will certainly keep an eye on that.
Eamonn,
ReplyDeleteI couldnt bare it!! LOL
There are 23,210 (23 THOUSAND!) gold futures call options at $1600 (expiring next tues afternoon) with a notational value of $3.7 BILLION!
ReplyDeleteI've never seen numbers that high.
I don't know where gold goes in the next few days, but it is VERY likely we are at or below $1600 early next week.
If we aren't and gold runs higher through that block of options (unlikely as always, but never impossible), then it will be one heck of a move to behold.
Personally, I'm long 4x gold futures from about 1550 and holding. I'm looking for an entry to add like everybody else which I expect it in the next week or so (but to/at what level I don't know).
ReplyDeleteMy guess is that 1550 will not be reached again and any pullback stops no lower than 1570 or so.
TZ,
ReplyDeleteWhere did you get that info?
Note that Aug is a large gold contract delivery month as well (one of the reasons the call options are so high) and thus the guys in charge will want to drive gold down next week for both options expiration AND for the start of Aug delivery process.
ReplyDeleteSome strong attacks next week or near the end of this week are in the cards. The momentum today, tomorrow, and maybe wed will help to draw in some remaining weak hands to crush.
Woe to anybody buying the 10th, 11th or 12th straight up day in gold here.
You guys remember this Gann Fan Chart: i did this chart Weeks ago,anyways we are about to Get a Criss Cross Fan Hit on the 20 th (Give or Take )
ReplyDeleteat first i thought it was going to be a High, for both PM & SPX,,,Today i'm thinking We will still get a Pivot.But ,Maybe we get a High (short Term in PM) and a Low on the SPX.
Exciting Times Here.Lets see if this Chart Calls a Pivot
http://screencast.com/t/sZjAjIa6s
WW,
ReplyDeleteGold contract trades on the CME.
www.cmegroup[PUT.DOT.HERE]com/trading/metals/precious/gold_quotes_settlements_futures.html
That page shows the large open interest in the upcoming Aug month (which starts delivery end of next week).
Then click OPTIONS and push the UPDATE orange button. Scroll down to see the puts and calls of current month.
Russell: DGP is on my sell screen...but it got there first at 49.50! Think of the screen as super-extreme overbought. In hysterical up moves that can go on for a while. It's why I like some other clue OR a reason to believe there is no reason for the crazy rally. Then I'll short the item. The fundamentals on gold are so strong, and the likelihood of higher highs is so great, I have not sold a share. I hope we pull back because I would just by more. So...yes, it's on my sell screen, butt also...so what? I am not going to sell some to avoid a 2% two day dip and then get caught light for possible fireworks.
ReplyDeleteÉamonn,
ReplyDeleteIn particular I'm looking at GLD call 151 10-11 1 contract.This calculator does not recognizd an Oct contract.
But in general I was fascinated by that color spread sheet and would love to have it in my arsonal!
Jenny,not working for me either. dont know why :o(
ReplyDeleteI am trying to figure out the SOS and BOW numbers and how they are generated. Any help appreciated. What site can that data be found on? I had heard we had some SOS in GLD today.
ReplyDeleteThanks all.
yeah, so what?
ReplyDeleteFTW,
ReplyDeleteSo, bout damn time we got some SOS in gold. I need a DCL to fill up on! ;)
What I want to know is technically how those numbers are generated for my own education.
robert, my poker enthusiasm has been smashed to pieces with the recent shut down on full tilt, i lost 65k. well its frozen in cyberspace somewhere and i dont hold much hope for it.
ReplyDelete"Anyone else own collectable coins? The pre-1933 Saint Gaudens graded MS-65 are extremely cheap,trading at their lowest premium to melt value ever. Beautiful, too."
ReplyDeletei have 3 of these, very very nice coins, paid £980 each a couple days ago. gl
Big options volume on GLD 145 AUG PUTS today, interesting how a strike so far away would have so much action today.
ReplyDeleteRemember people that expiration are next week and 90% of the time the metals are temporarily taken down--last month gold fell all the way to 1480's
ReplyDeleteFrom
Jesse's Cafe a very good blog "
Gold and Silver have risen quickly to a very important resistance level. I do not yet consider this an achieved breakout.
There are strong cross currents in these markets, the global sovereign debt situation in Europe, and the less remarked situation in the domestic US, highlighted but not captured mostly by the debt ceiling debate which is more of a showpiece than a serious change and prioritization.
I suspect that if the US comes to a resolution of its troubles, for a few days at least, the markets will rally, and the metals and perhaps Treasuries will be beaten like rented mules.
However, the looming crisis in Europe, which has the banks salivating for cheap national assets, is going to continue to weigh on markets by posing systemic risk in the manner of Lehman Brothers.
And as a reminder, the August Comex Options Expiration is next week
Very similar to the also curious OEX option action at the May top.
ReplyDeletehttp://imageshack.us/photo/my-images/593/20110715toscharts.png/
http://imageshack.us/photo/my-images/715/20110718toscharts.png/
Gary,
ReplyDeleteHave you ever considered adding Volume Spread Analysis (VSA) to your toolbox? It actually nailed the silver top (climax). The symbol you see (Red & Green square) above the candle for the high at 49.82 is a selling climax indication. This condition is almost never seen and its the only possible system that could have gotten you out at or near the top.
http://imageshack.us/photo/my-images/847/silvertoscharts.png/
TZ,
ReplyDeleteThanks for that info, definitely something to keep in mind. Much appreciated.
Strat,
ReplyDeleteWe were already set to get out but got caught by a gap down open on Monday morning.
DG,
ReplyDeleteThanks for your thoughts re DGP and technical sell signal. I'm trying to trade the IT cycle, but I can't help but try to time the daily and watch the technical signals. Since we're week 3 of a 20+ week IT cycle, I'm trying to stay old turkey. As my ability to time stinks, and there seems to be literally a whole world that is worried about currency debasement, I will try not to get too cute with buying and selling.
Claratoid,
ReplyDeleteVery sorry to hear that. You should join the class action lawsuit if you're not already part of it. If not, let me know and I can post a link with more information. I know it names a few of the obscure owners as defendants, as well as many of the sponsored players, included Phil Ivey who supposedly owned a 5% state in FT.
Can this be a tax write off?
I still think the game has many strong years ahead. There is already talk of new poker bills which will bring on some type of new platform to the US market.
I really think FT and PS, although they did illegal things, are just getting pushed out of the market for someone else to start raking it all in.
Wish you well brother.
Gary,
ReplyDeletethe gap down in silver that Monday morning was a prime example of manipulation by the Fed and their banks==plain and simple
7/26 (options expiry) is a very plausible day count for a daily cycle top.
ReplyDeleteDuring the blow off Jan 2008 run, we had a massive candle on 1/22/08, it marked the DCL. It was a frightening $50 drop after what had been a 20 trading day $100 move higher. (Don't forget we're talking much bigger % moves being 2008) Something similar today would be an intra-day $80 swing. (Hat tip DG for suggesting the possibility)
BTW the candle on GDX was $49.50 high, $44.85, a monster $4.65 swing. Trade the bull, prepare for the outcomes.
We get another such candle it will guarantee a massive puke. Be prepared to run head first into the depths of the decline and buy it up that same day. In the example, 5 days later gold was up $95 from the low of that day. GDX was $52!
This next 5-7 days should provide clues on what to expect out of the coming DCL.
Gann, this is in a similar vane, but not gann.
ReplyDeletehttp://screencast.com/t/pzGQmHhut6
Robert,
ReplyDeleteIncreasing the margin requirements was a prime example of the exchange trying to protect itself from an asset that was trading on pure emotion, terribly stretched above the 200 day moving average, and at great risk of a volatile correction.
Just because something doesn't behave like you want it to isn't confirmation of manipulation.
The fact is that silver was in a massive parabolic run. Those are not sustainable. That parabola was going to collapse whether margin requirements were raised or not. There was no way silver was gonna get through $50 on the first try.
Yes raising the margin requirement probably constricted the correction down to five days instead of five weeks but it was still going to happen either way.
Silver was in a runaway move and runaway moves usually end in a crash.
As much as you would like to believe that there is an evil cartel out there trying to prevent you from making money, it simply isn't true. If it was, the price of silver would've been capped at $25 long before it ever had a chance to reach 50.
Gotta love silver here. I won't add, but sit comfortably on my AGQ and SLV. In the mid thirties silver offered a low risk entry; above 40 however the risk is, of course, growing in leaps; yet I continue to believe that if silver won't knock out 50 this year, it'd be a bad omen for the silver bull in general. My biggest position is in DGP, followed by AGQ. I am also holding some nano cap silver miners, but only humble positions. And still holding some DAG, CORN, and AGRO. Still believe that the dollar will continue to be trading sideways for the time being without resolving to upside or downside before late September. Late September will be the game changer then, possibly with a thrust down in the dollar and a blow out top in gold, before a dollar turn around, accompanied by a sharp correction in PMs.
ReplyDeleteRobert,
ReplyDeleteI agree that Jesse's Cafe is a good blog, but he publishes misinformation here:
"And as a reminder, the August Comex Options Expiration is next week"
You and I won't be fooled, but some less experienced posters might.
Best,
Le Fou
Gary,
ReplyDeleteI looked at the Senior National Results and the 77kg and 85 kg Men class winners beat out the top three weight classes: 94, 105 and 105+ kg.
Is that correct and why? Seems weird.
Anyway glad your team members did well.
>> In the mid thirties silver offered a low risk entry
ReplyDeleteSorry, Oxymoron if I ever heard one. The only reason you believe (in retrospect) that silver was low risk in the mid-$30's is that it happened to work out for you so far. Silver is the most volatile trading instrument out there second only to penny stocks. Rationalize short term gains all you want, but it's EXTREMELY risky to try to guess this one.
I for one am with Gary, broken parabolas do not behave like the current silver bulls want to think they do. We're headed for an impending massive silver correction. This is just the market's way of getting the bulls back into the trade before the floor falls out yet again.
Alex,
ReplyDeleteChad Vaughn and Kendrick Ferris are both phenomenal lifters. They are by far the two best lifters in the country.
Gary, in weightlifting, what role does psychology have to play?
ReplyDeleteLe Fou,
ReplyDeleteJesse is correct. I checked the COMEX gold option expiration dates:
The August series expires Tuesday the 26th of July.
The September series expires August 25th.
Other expirations
Oct series is Sept 27
Nov series is Oct 26
Dec series is Nov 22
FYI
Gary,
ReplyDeleteYes, those two guys had great results.
Alex
I am wondering, can psychology & the will to lift the weight give you "extra strength", or is it in reality purely deterministic on your physical make-up?
ReplyDeleteAlex in Montana, maybe its time you took up the weightlifting?
ReplyDeleteEamonn,
ReplyDeleteI won the Armed Forces Europe championship back in 1969, qualified for the National Collegiate Championships in 1973 and placed 4th at the National Masters in 1987 at 40 in my age group.
At 64 I am little past my prime.
My totals were way less than Gary's. I still lift though, just no comps any more.
Alex in Montana, I'm sure you could give a lesson or two to men at least half of your age
ReplyDeleteGary,
ReplyDeleteI am curious about our exit strategy based on the information available at the present moment?
Thanks.
What do you mean exit strategy? It's only day 10 of a new intermediate cycle.
ReplyDeleteLe Fou,
ReplyDeleteHe does have a great blog but he is correct about expirations --h--expirations are next week on the 26th--the cartel will try its usual attack on the metals,just like they have for almost every one
gary
ReplyDeleteis there any predicting how may daily cycles there will be, should be, could be
I was looking for a general idea of when you will close the trade. If you covered it a post, please refer me to it.
ReplyDeleteI went over the average gain in one of the reports last week or maybe it was the week before.
ReplyDeletehippie
ReplyDeletegary hold through a intermediat cycle.
smt does not try to trade the daily cycles we just buy dips
hippie
ReplyDeleteare you a member? look at the cycle charts
My concer now is that the debt ceiling might be "resolved" without warning anytime before the deadline sending PMs and associated equities/ETF majorly downwards.
ReplyDeleteMr. M,
ReplyDeleteIt's not going to terminate the intermediate cycle.
Gary,
ReplyDeleteYou don't think it would be a significant enough action to alter the cycle?
If the debt ceiling is raised without addressing deficit, PMs will soar.
ReplyDeleteZerohedge noted that comex has not reversed any of it's increased margin requirements for silver despite it's plunge from 50 to 32. Why would they need to further hike margins during this move?
ReplyDeleteI haven't posted in quite a while but had to jump in after seeing that Gary is repeating the same mistake that's been floating around here for a while.
ReplyDeleteIn tonights report Gary states that raising the debt ceiling would mean more money printing.
Not at all.
Raising the debt ceiling means that the treasury can sell more bonds. Those bonds are sold to the public who trade their exiting money. Not new money.
Money printing only happens when the FED is involved. Currently, they are not stimulating the economy through money printing (i.e. bond purchases)
One might make a case that this opens the door for more stimulus etc... But that's a subjective opinion.
It's been hard not taking profits here...
ReplyDeleteCatch you all later or tomorrow.
jlinks,
ReplyDeleteYou got to be kidding...we are not going back into this stupid debt doesn't matter debate again.
Gary,
A little concerned if gold doesn't correct soon, and I mean soon!...could be an inter-day event, but if some of the steam isn't taken out of this thing, I am getting nervous that this will be a fake rally for gold, just as the manipulated rally for stocks was. 10-11 straight up downs is crazy, what next 20 straight up days? Does anybody have a precedent for how long gold can rally in a healthy rally without a day off. Hair on the back of my neck is perking again. HAPPY TO BE REALLY WRONG!! Hopefully we correct real soon!
Kyes
ReplyDeleteNot sure what you are referring to. Care to expand?
Keys,
ReplyDeleteThere is no question at this point that gold put in an intermediate low. I think gold is just setting up for the parabolic finish that we've been looking for for almost two years now.
jlinks, when (not if) the debt ceiling is raised and more bonds are issued, the Fed will have no choice but to step in and continue buying them. These asset purchases (using printed money) have been the only thing keeping US gov't borrowing costs so low. By definition, when the gov't starts issuing more bonds, there will be more money printing.
ReplyDeleteHarry
ReplyDeleteBy definition? Whose definition? A lot of very smart people agree that new stimulus are off for a while and expecting yields to rise.
Unless it's your definition, in which case it's subjective and I stand corrected.
Jinks,
ReplyDeleteThe Fed's balance sheet has expanded by several trillion dollars and it continues to expand. The Fed is printing money and buying assets whether they announce it as QE or not and have been for over two years.
If citizens were to buy bonds then yes the Fed could drain liquidity by selling treasuries into the market. However I think there will be limited buyers at these interest rates.
In order to get anything resembling true demand I think Bond prices are going to have to fall and interest rates rise.
Thanks Gary and Jeff. Sometimes I get forest confused with the trees.
ReplyDeleteGary
ReplyDelete"The Fed's balance sheet has expanded by several trillion dollars and it continues to expand."
True
"The Fed is printing money and buying assets whether they announce it as QE or not and have been for over two years."
FOMC is a tool used by the FED for decades. When we are talking stimulating the economy, their plans are announced first, aka TARP, QE1, QE-light, QE2.
"If citizens were to buy bonds then yes the Fed could drain liquidity by selling treasuries into the market. However I think there will be limited buyers at these interest rates."
The debt ceiling raise will allow new bonds to be sold by the treasury, not old bonds held by the FED. These new bonds will be sold on the bond market and bought with existing money, unless the FED announces new stimulus.
Simply stating that raising the debt ceiling means money printing confuses economic cause-effect.
jlinks, you are technically correct that new bond issues will not necessarily constitute new money printing. Fine, I'll grant you that. But given how low bond rates are at the moment I think Gary is correct that there will not be enough true market demand to sustain prices at current levels. That's unacceptable as far as the Fed is concerned, and they will have no choice but to step in and buy. So I think it not unreasonable to say that new bond issues will, at least indirectly, beget new money printing.
ReplyDeleteAlso keep in mind the size of the Fed's balance sheet; simply rolling over the trillions in treasuries they're currently holding, which are mostly short-term, will be enough to keep a price floor in the bond market for a while.
Gary, I am confused with the last paragraph in today's report.
ReplyDeleteSo are we saying that there will be a correction or there will be a runaway move? Can you please clarify.
TIA.
The universal problem that most inexperienced investors have is that they try to trade around an expected correction.
ReplyDeleteI've gone back and forth with myself many times as to whether it's helpful or not to prepare people for a daily cycle correction. I suspect most people trade out of their positions and then when the market doesn't correct immediately they end up panicking back in at, or close to the short term top.
When I say I expect a correction that is not a signal to sell your positions, it's a signal to prepare to add to positions.
For all we know gold could continue higher for another 10 days and anyone that sells now could miss out on a huge rally. It's just not worth the risk of missing the upside in a bull market to try and sidestep a minor 1% or 2% pullback.
Thanks Gary, I just wanted some clarity as I am going on vacation and wanted to take some action before then.
ReplyDeleteI'm keeping my promise [to myself] to do this one Old Turkey style, and I absolutely will not touch my contracts right now, but I just want to mention that the daily RSI is now maxed out.
ReplyDeleteJUST SAYIN', GUYS.
Duuuuuuuuuude
ReplyDeleteThat,s a Fib Time CYcle ,Right ?
Ty
RSI on any "normal" setting is very far from maxes out IMO!
ReplyDeleteYes we're way overdue for a red candle, but let's give this bull the credit it deserves. Something greater than cycles and TA in gold is at hand now.
Ride with it, run with it or get crushed by it.
Yes Gann. I just thought it was interesting how well it seemed to line up with the SPX cycles. I also find it interesting that the next fib line is on August 4, just two days after the scheduled debt ceiling vote. Not saying I know how to trade it.....just interesting. I would respect it as a bull or a bear.
ReplyDeleteThis comment has been removed by the author.
ReplyDeletePoly,
ReplyDeleteI hope you are correct with your beliefs about gold's current IT cycle, but wouldn't you agree that the dollar still has to find its 3 year low in order for this move in gold to go parabolic?
Rob,
ReplyDeleteIt's certainly not acting that way at the moment.
Gary,
ReplyDeleteI know! And your comparison with the $USD '08, in tonight's letter, was an eye-opener. The current formation of the USD looks almost identical to the last 3 year low.
This comment has been removed by the author.
ReplyDeleteThe current intermediate cycle in the dollar is too late for an explosion. If not this daily cycle than likely the next one will begin the move down into the intermediate low.
ReplyDeleteThe expectation is that the move down into the intermediate low will spur gold into a parabolic top.
Gary, Interesting Gold post on SOH, do you have anything to say ;)
ReplyDeletehttp://slopeofhope.com/2011/07/is-there-a-gold-bubble.html
Gold will certainly be a bubble one day, but it obviously isn't at the moment.
ReplyDeleteIn order to be a bubble the public has to panic into an asset similar to what happened with tech stocks and housing. Go ask any of your neighbors and I bet you'll find that none of them own gold. When gold does become a bubble half of them will own gold.
E, I'll have to concur with the most recent comment on that post:
ReplyDelete"I like how anyone can look at that kitco chart and call it bearish. Unfukin-believable."
If the dollar is indeed basing '08-style, that would be very ominous for gold, would it not?
ReplyDeleteMy memory is that gold made marginal new highs in summer 08. I chased those highs, much as I am now, and got creamed as the dollar rallied into the meltdown.
If the dollar explodes higher, there's a strong chance that this is a false breakout.
08 was the eight year cycle low for gold the next one is due until 2016.
ReplyDeleteYou probably don't have to worry about another 30% correction in gold for at least another five years.
At this point every intermediate cycle bottom should hold. The last one came in at 1478. So we should not see gold below 1478 for the rest of this bull market.
Gary,
ReplyDeleteAfter approximately 2016, will the gold bubble be exhausted? What will the 8 year cycles look like after that time?
Thank you.
Elaine
Éamonn,
ReplyDeleteI finally got the Profit Calculator to show it's colorful spread sheet by using GDX, call, $55, Sept 11 and 1 contract. Thank you!
Jenny, good luck :o)
ReplyDeleteHi Gary,
ReplyDeleteJust wanted to clarify, you are talking about a parabolic top in the next few months, is that correct?
Also, you said
"You probably don't have to worry about another 30% correction in gold for at least another five years."
Does this mean it will still be worthwhile dropping our gold position after this parabolic top, as less than 30% doesn't really seem worth it to me?
Thanks
gary said
ReplyDeleteI've gone back and forth with myself many times as to whether it's helpful or not to prepare people for a daily cycle correction
clearly you warn not to trade these wiggles and to buy the dip.
I like it when you prep us for a pullback. Its not scarry when it happens and buying the dip is very satisfying. Plus the ones sittting there need help getting in.
the call came pretty sudden this time without the preperation beforehand like so offten. but you didnt get caught off gard, you saw it when it happened.
I guess im trying to point out if someone wants to get cute that is there problem. If they want to buy a dip like they should then they need help.
I vote for prep for the dip
Mike,
ReplyDeleteMy expectation: if this is parabolic C-wave the following D-wave can or will correct as much as 2/3 of the move. So if here goes to 1850, correction to 1574/1600 is within the reach.
Gary, you had mentioned a month or two ago that gold C waves in the future would not end with the sharp parabolic rises that they have in the past because of the large amount of gold held by large funds now.....that the topping process would be less of a spike but more of a rounder top. How far stretched above the 200 sma do you see future C wave tops being?
ReplyDeleteRob,
ReplyDeleteNo I do not agree that the dollar must find a lower 3 yr low, due to the nature of this rally and environment. Although it would obviously help.
Hubert Gold Sentiment Index has risen from 10% to 67% in last week. Per Jason.
ReplyDeleteMaybe the breather in gold will come today. As I type, gold has dipped below 1600; however, we all know that these moves before the open are pretty unpredictable...
ReplyDeleteLooks like we are getting a breather today. What levels do you guys recon we are going to get? I got a order to buy at 1581.00 but maybe that's to low.
ReplyDeletebefore we get a larger dip sma 55 on the hourly has worked as a good buyer..though i'll wait
ReplyDeleteMike,
ReplyDeleteIt 10 or 12% correction is scary in gold. Miners can lose up to 25%. One of these. Yes I think it's worth avoiding if at all possible.
Gary, I guess you felt my questions on weightlifting were lame. how embarrassing for me
ReplyDeleteElaine,
ReplyDelete2016 is when the next eight year cycle low is due. My best guess is that we will get the parabolic bubble top for gold in 2017 or 2018.
E,
ReplyDeleteWhat questions were those?
I was wondering about the role of psychology in weightlifting. You know, if the sheer will to lift the weight gives you any extra strength or is it all objectively in reality solely deterministic based on your biological condition....
ReplyDeleteMost definitely psychology plays a huge part in weightlifting. One has to visualize themselves being able to lift the weight.
ReplyDeletegary,
ReplyDeletesorry for asking but cant find in your report..should an order be placed at 10 SMA on gold now or are we gonna wait before placing it?
Gary, thank you.
ReplyDeleteND,
ReplyDeleteThe model portfolio is fully invested (75%). So at this point I'm not looking for further entries.
If you missed last two entries and you need to make a plan where you want to buy and what your backup plan will be if those levels aren't reached.
i took my first pos on the last entry.. but looking to add further. think i'll add some at 10 sma and the the final once the swing low is confirmed during the daily cycle low.
ReplyDeleteonce we ge our next swing low do you put your stops at that level?
Éamonn,
ReplyDeleteI finally got it to work! I used GDX call at 55 9-11 1 contract and got the colored spread chart I was looking for.
THANKS for your help!
Jenny, good luck :o)
ReplyDeleteMichael: Yes Jason said newsletter sentiment has risen sharply on gold, but also that that indicates coming short term weakness (1 week or so) only. Fits with a DCL low coming up.
ReplyDeleteGary -
ReplyDeleteHow many daily dollar cycles are there in an intermediate cycle?
Hi Gary, I'm new here and wanted to know why 75% is the max for the model portfolio? do you ever invest the remaining 25%
ReplyDeletethanks
Mike,
ReplyDeleteUsually three or four.
The model portfolio is designed for the maximum number of investors. For most people 75% of their portfolio concentrated in one asset class is more than enough exposure.
ReplyDeleteIf you want to take on more risk than that then adjust your position sizes accordingly.
I think we could except a DCL early next week, 26th perhaps tying in with options expiry. Thoughts?
ReplyDeleteDan,
ReplyDeleteThat's probably too early. I'm looking for a minor corrective move here followed by one more push higher into a daily cycle top.
26th sounds good for a top, but not a DCL.
ReplyDeleteGary,
ReplyDeleteWhat will you be looking for to gauge a daily cycle top as far as volume, etc.?
Gary-
ReplyDeleteSo you are looking for an intermediate cycle dollar correction after this or next daily cycle followed by another intermediate cycle higher which runs into Oct or Nov?
cycles are pretty much worthless for spotting tops.
ReplyDeleteWe just have to let them happen and then try and catch the bottom of the correction.
That's what cycles do they give you a timing band for a bottom, not a top.
thanks for the info gary, and wow, 389 total for a 21 y/o is pretty darn good. congrats!
ReplyDeleteGary,
ReplyDeleteI understand...you have taught me that before. I seen STRAT81 mentioned possibly using Volume Spread Analysis to spot tops, would you consider giving it a try?
A daily cycle top on the 26th? You guys don't think the big boys will try to keep gold under 1600 for futures and options expiry on the 26th?
ReplyDeleteEamonn,
ReplyDeleteSo much for that $50 move over night due to short covering because of the close above 1600...I guess that London Trader got it wrong?
William Wallace, seems so!!
ReplyDeleteDan,
ReplyDeleteYeah especially with that big 1600 call options number, over 23,000.
Is it not possible we trade sideways from here, bull flag it, until options expire, making the DCT around 1600?
ReplyDelete1610.70 DCT to be exact.
ReplyDeleteWe may not see a scary DCL if we trade sideways until the 10sma catches up.
ReplyDeleteYesterday gold was up and GLD was near the top for SoS selling on strength, today gold is down and GLD is near the top for BoW buying on weakness.
ReplyDeleteNot sure how relevant these stats are with behaviour like this.
Dan,
ReplyDeletePeople are so confused right now...I think the fact that the intermediate cycle low caught many unawares because everyone was expecting a bottom on the 150sma, and then this rally where everyone is expecting a pullback that is still to be seen...I know im losing my mind, the BOW & SOS numbers are whats keeping me sane because I see im not the only one!!
10SMA is at 1570 today and going up approx $10 per day.
ReplyDeleteSo theoretically it will be at ~1600 by friday.
Gold 1600 - to those who see 1800 BOW...to those who see 1575 SOS
ReplyDeleteSASA,
ReplyDeleteIf we trade sideways it wont go up $10 a day.
I won't be making any adjustments to my metals/miners positions today.
ReplyDelete