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Wednesday, January 25, 2012

PORTFOLIO CHANGE

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149 comments:

  1. Interesting that treasury yields are falling hard today...

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  3. at ease,

    answered on the other page...LOL

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  5. Stocks not breaking new highs so far....Let's wait for the dust to settle

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  6. Sophis, this drives me nuts changing pages, wonder where I can find WW now?
    He's not here. LOL

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  7. Lol Gold stocks are up 4% today after being in the negative. Gold has officially broken through it's downtrend line along with the commodities index and silver is up over 3%. What are you guys complaining up about? PMs are not gonna go up double digits % in one day, if we just hold these gains into the close everyone should be thrilled.

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  8. WW thanks took profits at1661 then went long when broke 150, wondering if you still looking for reversal at 1700 area. Veronica had a nice day, congrats.

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  9. Gary you were right finally ate my short snp. The fed changed my mind. Good job.

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  10. Riley,

    Didn't take a short at 1700, no indications of a reversal yet.

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  11. Wedge in gold broke higher. I was afraid of that (and hopeful it wouldn't). We were all out and waiting patiently which is the exact reason this isn't stopping. Too much money waiting to buy.

    Now the chasing starts.

    The gold wedge break is now the same day at 8/2/11 for anybody who wants to look at a chart. Big move up. Likely to get a small pullback shortly, but nothing too extreme.

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  12. AUY is a dandy, staring a new 52 week high in the face. I'd also think investors would be happy that EXK's management only sold 1/3 of their output last quarter, keeping the rest to sell at higher prices:

    http://www.kingworldnews.com/kingworldnews/King_World_News.html

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  13. GDX is not beating 'straight metal' on an ongoing basis yet, HOWEVER there is a SERIOUS downwedge pattern in it of over a year looking like it will break higher soon.

    On that pattern and gary's move I am now in GDX. I'm gonna join the 'anticipation' bandwagon. Hope it doesn't hurt too much.

    I'll post a pic of it later today.

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  14. Maybe that breakout in QQQ (10 year high) and RTH (all time highs) meant something.

    How fast sentiments can change in this market, stretched cycle or not.

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  16. I'll still primarily buy futures, but there is no clean entry at this time (same story for last 2-3 weeks).

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  17. I used to trade futures, but since they aren't covered under SIPC protection and I expect more dislocations like MF Global, I'm sticking with my miners.

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  18. Wow SPX and the ES are at major upper trendlines, and the SPX is extremely stretched above the 50dma...if a reversal is to occur now I would expect it right here. This is the perfect short area if any.

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  19. How much money does one have to lose trying to short the market before they finally get the hint? This market should have turned lower a couple of weeks ago and it didn't.

    Way too much risk of a runaway move to sell short in my opinion.

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  20. Here is the GDX going back to inception. You can see a VERY large downwedge formation over the last year. (A down wedge is a bullish consolidation usually.)

    img546.imageshack.us/img546/8518/gdxwedge.gif

    You can also see that this downwedge is consolidating at/above the high (or breakout zone) of approx 50-55 (horizontal pink line).

    The easy argument to make here is that we have spent the last YEAR congesting and consolidating the breakout zone to head higher.

    (It was POSSIBLE to argue lower instead, but recent action has made that pattern clearer and it would be very difficult now to argue down vs. up at this point. I think we would all agree the direction appears clearer up.)

    A break higher from a wedge that large would be to at least $70-75 I think (over time of course).

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  21. Gary, the heck with the SMT, just offer a spanking service for people tempted to short. You'll make a ton of money based on the comments on the board.

    ;-)

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  22. You are correct on shorting Gary!
    Dumped the boat load to move on.
    Excuse me while I got out and slam my fingers with a hammer!

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  23. >I used to trade futures, but since they aren't covered under SIPC protection and I expect more dislocations like MF Global, I'm sticking with my miners.

    I have substantial 'real' assets other than the futures. Since futures will go up to 10x you next only a small portion of your total net worth in order to fully trade them.

    And I've already discussed how IB sweeps all free cash to the SECURITIES account and only keeps the minimum in the COMMODITIES account.

    And if your free cash is over the SIPC max you can solve that by buying treasury bills which only require a 1-3% margin but yet are not 'cash' for the sake of recovery.

    disclaimer: not responsible for accuracy of anything here. Not financial advice.

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  24. That GDX wedge chart is WEEKLY. Each vertical line denotes 3 months.

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  25. Funny any loss I ever took shorting the SPX I regained and then some shorting gold. Thats just me :)

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  26. "This market should have turned lower a couple of weeks ago and it didn't."

    So how does this buy fit into your cycle analysis work for both the stock market and gold?

    I find your swing in sentiment quite interesting over the past few weeks.

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  27. To be fair, expect for the NSQ, the markets are still at the same level as the high of yesterday, so maybe W2 you will get that selloff...
    Hope you covered Gold though...take care

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  28. Note that GDX has NOT broke up and out of that wedge yet. So since I'm buying because of that wedge (and gary), I am anticipating the break which has its own risks. I'm not crazy long like with futures, but I have enought to count.

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  29. Eric,
    Read my comment to WW, the stock market is at risk of entering a runaway move. If that were to happen then we can throw our cycles and sentiment tools out the window for a while.

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  30. Sophia,

    Covered gold short when I posted that anyone who took my short at the 150dma should lock in profits NOW. That was at $1652.

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  31. stockcharts[PUT.DOT.HERE.TO.FIX]com/h-sc/ui?s=GDX:CEF&p=W&b=3&g=0&id=p37927067386

    And gdx vs 50/50 gold and silver still looks like crap so I'm violating the earlier reasons I gave to stay away. We will see how that works out. Just want to be clear, however. My earlier arguments would have been to either A) wait for that wedge break higher or B) wait for clear outperformance on the ratio chart.

    I can tell I chased today with almost everybody else (after 3 weeks of gold gains). That's not a good sign - at least for the short term. This was an emotional buying day unlike the previous few weeks where we were calm and waiting.

    It is a sign we are approaching a point that will likely get retraced back upon.

    That is the reason i'm not 3x or whatever which I normally am with futures - I can't get a good entry yet (shades of last fall...but it still turned out VERY good :-).

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  32. This is what I call a "recognition" day. Until today people were still unsure or unwilling to commit. Today 'recognition' kicked into the whole sector.

    BEFORE a recognition move your position is usually SAFE (but hard to take or hold.

    AFTER a recognition move yoru position is usually in jeopardy of a drawdown (but is easier to take, of course).

    Such is the mkt.

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  33. W2,

    good to hear...will sell some of my silver tomorrow morning, I think that the level to watch is 33.30 ish....cash is king in this business

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  34. TZ,
    I have a question on Interactive Broker trading. I just opened an account this month but didn't transfer the $100k needed to get margin so unable to guy 1 GC contract. How do I trade YG? I can't seem to, there's no price on the screen.

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  35. at ease,

    NEVER "load the boat" when shorting. Better yet, if you dont have a system to recover the loss from any short dont short all, as Gary has stressed many times.

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  36. Uhuru,

    You need to subscribe to data and trading permissions in your new account.

    If I'm not mistaken, there is a small monthly charge for access to the mini's, perhaps a few bucks/month.

    You can do it all without calling IB, just login to account management.

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  37. WW,
    I have multiple accounts, so when I say boat load, I mean transactions, not total amount. My biggest loss $ wise was the short entry today, shorting mini gold futures LOL. I think it filled while I was out of the room and didn't notice it, until I was selling UUP to buy long in NUGT. SDS didn't do too bad, nor did UPP. Meanwhile up, up, up it went! But gone now, not sitting on a runaway short mini gold after todays action. LOL Alles gut!

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  38. Doc had the premonition! He nailed it!

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  39. WW,
    The good news is, I have another boatload of TGLDX all bought on dips and the the Oct and Dec lows!

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  41. SB and/or TZ:

    Would either of you mind helping me understand all the various sources of "dislocation" and counterparty risks involved with futures trading? I *think* have a handle on it but would appreciate the perspective of someone with more experience (and caution) in this matter.

    For example, if one is long a futures contract. Then the seller of that futures contract could go belly up, in which case I believe the exchange assumes the risk and your contract is covered.

    Of course, this leads to the second source of risk which is that the exchange itself goes belly up. In this case, just the funds outside of a SIPC-covered securities account are subject to loss? Though I thought I heard that the cash amount held in margin is also insured? Or am I wrong on that?

    Last question I had was to what extent one could be liable for the full balance owed on the position. Leveraging up on futures strikes me to be more like borrowing on margin (i.e. if you borrow 50% from your broker to take a 150% position in an ETF that goes to $0 you now owe your broker) rather than buying options (where if the underlying goes to $0 your position goes to $0 but no more).

    Appreciate any insights you guys could share!

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  42. "If that were to happen then we can throw our cycles and sentiment tools out the window for a while."

    Gary,
    And this is where you need to really clarify. How do you conclude that we are in a runaway move and cycle analysis and sentiment no longer work?

    Last week, as i had pointed out the QQQ and RTH breakouts you mentioned that technically, turning points usually occur when the charts look the MOST BULLISH.

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  43. Thx TZ & SB. I'll check the data feeds first, and reach out to IB directly otherwise.

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  44. We are still in the daily cycle band of gold. It is just that the cycle low may come at the last few days of the cycle!

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  45. Hey Gary,

    You seem to have an excuse and statement for everything.. Don't you see the inverse hs on the dow... didn't you look at the charts for a lot of the industrials as they bottomed, didn't you notice copper and the six breaking out together a week ago... it was simple accumulation and distribution by the boyz..

    cycles are not accurate at all.. We had one idiot on kitco who everyone admired named cyclist... He got a lot of shit wrong including his cycle analysis stating silver and the miners would go to 12 dollars in aug 2010... Hmmm last time i checked the metals ran off and left a lot of people behind..

    This also explains why I JUST BUY AND HOLD GARY!

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  46. ver,

    It's not just futures, but just about anything these days. To use you example about the other side of a trade going bust would be the least of my concerns if it happens in a normal trading environment b/c their are provisions to make you whole. There are many other considerations that are coming to the forefront these days, like what if a broker bets customer funds and loses, or steals funds outright, both of which MF Global did, and their were a primary dealer at the Fed. Even worse, the "regulators" at the CFTC assisted the indiscretions so far.

    There are many types of risk that market participants typically don't have to worry about in normal situations, but times have changed. My point about futures is that they are not even covered by SIPC if the firm goes under, and we now know we cannot count on the CFTC either.

    I closed 3 margin accounts since the middle of December, kept one open in case I want to borrow on it. I did this because firms make traders keep securities in street name, which means they can also lend out your stock. It's just one more loose end I wanted to fix BEFORE AND IN CASE things deteriorate further. If we don't act ahead of time, then when?

    Not saying we see systemic collapse from here, but I'm putting my stopgaps in place now b/c there is far more risk than at any time since I've been involved in markets. Most only focus on market risk.

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  47. ver,

    For an example, look into what exactly happened to the Hunt Brothers. It wasn't silver that killed them, it was when they got into futures where the boys in Chicago make (and change) the rules as they see fit. What's worse, not only did the Hunts get driven to the poorhouse, but the guys on the other side of the trade who make the rules are the ones that took their money.

    I'm sticking with miners (some registered to me, not street name) and physical until I have reason to believe crooks will be held accountable for their actions. I'm not leaving much on deposit or margin in the hands of thieves.

    Good night fellas.

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  48. P.S.

    It was the crew in Chicago that shorted the piss out of silver, just before they changed the rules on the Hunt Bros. If you research any other story that neglects to mention this fact, move onto the next until you get the truth. Regulators are not there to protect us, they exist to keep the system going for them.

    Good night, fellas. :)

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  49. Update to GLD Gold 144 Cycle Chart Hits Tomorrow!

    http://screencast.com/t/q7AMWKwSv7GJ

    Should be a Cycle High

    Gann360

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  50. WW, can you post if we are going long at the open?

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  51. My goodness it seems like everyone has decided that cycles don't work.

    I should point out that we entered positions today at a lower level than where we exited four weeks ago. All we did was avoid four weeks of going nowhere. We also avoided four months and a 24% correction. So I don't think anyone has any grounds to lecture on buying and holding.

    Just like every tool cycles and sentiment will fail occasionally. That doesn't mean they don't work. All one has to do is look at our performance over the last six months to see that cycles and sentiment do work the vast majority of the time.

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  52. I want you guys to understand I am JUST AS paranoid and concerned as shalom is.

    But I think I have covered not going broke IF the system locks up.

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  53. GARY,

    There is a silent majority here that knows darn well you/we are doing a good job and don't have any complaints.

    Don't let the few vocal outliers change that. Most have no skills or little money.

    Anybody doing this a while knows the real deal.

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  54. PS: 'cycles' is just another way of saying things rarely go straight up or straight down.

    That has always been true forever in history.

    There will be a pullback at some point in gold and it will be a 'cycle' and it will represent a better point to buy than guessing and jumping in randomly.

    Yes, it might be higher than current prices. That's life. Doesn't change the idea.

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  55. VER,

    The response to your questions is long and detailed. Hard to know where to start.

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  56. Gary, I am a very happy cyclist!
    I took all my profits made last year trading with you on cycles and bought TGLDX on the Oct and Dec ICL. Now I am back to trading with my original capital to keep making more funds trading cycles to add to TGLDX on the next ICLs. So cycles work for me! :)

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  57. So it was quite obvious that the Dollar had already topped, with or without S&P cycles, because of record short Euro positions and weakening breadth rally of the Dollar globally against all other currencies NOT shown in the DXY/UUP.

    In other words, even though people will say that it was a fluke call or some other excuse, the truth of the matter was that the Dollar already started falling against many many currencies globally - a huge singal.

    However, Gary told us Dollar bear contrarians that "we were making a mistake by focusing on currency sentiment and that COT doesn't work (better said: maybe doesn't know how to use it). Instead we should be focusing on the stock sentiment and cycles, which signal a correction and therefore, another rally in the Dollar.""

    My advice: start following the trade weighted dollar index instead mate, and add some global currencies from Asia or Latin America to your currency watchlist on top of that. Also, the first thing anyone in this business should ever learn - Do Not use correlations as a basis of your portfolio decisions. Look at every asset class on its own instead, because correlations break down or trick your judgement. Using DXY/UUP to gage Dollar strength is a recipe for disaster, and so is the use of stock sentiment to time Dollars next movement.

    You don't need Bernanke to figure it out. It is possible to call a top in the Dollar before him "in real time". Just my opinion, same two cents as before.

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  58. If you use leverage, you need SMT. There is no question about it. I gave up HUGE gains from the epic run in '10-11 because I thought I knew better than him (we are talking 7 figures!). Like an idiot i stayed levered all the way down, and kept trying to call a bottom.

    Whether gary gets the ST call right or wrong, he does things on a very calculated basis. His risk management skills are superb. He knows how to play the probabilities and wager accordingly. He's got a talent for it.

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  59. Cycles do work, but only God is perfect...with that said

    at ease,

    As you know I will be scalping gold futures both long and short without posting the trades because they are just to quick to do that, the trades I post here are ones that I am confident have a high probability of running 10-30 points, and those trades I usually have planned out ahead of time so I can give everyone a heads up... but right now we are on day 18 of this DC and almost every First Daily Cycle of an A-wave tops in 20-22 days, usually without a huge move like we saw today, so although there may be more upside left and there has been much talk of runaway moves and the dollar rolling over, I still stick to the cycle counts that are right there on the charts and wont call long trades this late in the cycle. I will definitely post a long trade when I think the DCL is in, but if anything it will be a short, as it has been, this late into the cycle.

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  60. Tiho,
    No there was no evidence that the dollar had topped until Bernanke opened his mouth this afternoon. This morning the dollar was in the process of putting in a cycle low. After the Fed meeting that cycle low had been aborted.

    Again you are trying to trade in hindsight. You are assuming that since the expectation you were looking for occurred that meant it was destined to happen.

    Until Bernanke opened his mouth all markets were at a fork in the road and could have taken either path.

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  61. Green,

    said:

    "Whether gary gets the ST call right or wrong, he does things on a very calculated basis. His risk management skills are superb. He knows how to play the probabilities and wager accordingly. He's got a talent for it."

    Absolutely, the truth. More people need to realize that Gary is not God, but a damn fine and seasoned trader.

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  62. TIHO,

    How much did you make on silver last year?

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  63. Gary, you are right. Therefore, we can safely say that there was no evidence for YOU, and that Dollar bears got lucky thanks to Bernanke.

    Thank Christ, that guy seems to make me lucky every time.

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  64. SB,

    "Regulators are not there to protect us, they exist to keep the system going for them".
    ...and then there was the FED....
    couldn't be more a truly spoken word. We are singing from the same hymn book..and perhaps on the same page too.
    I too hold miners and phys AU and AG in diff. formats. Didnt buy early in the bull (2007) but have been accumulating on dips since then. Hold core and investment components. Like you I am not selling...no matter what the S&P does.

    Gary,
    Are we there yet ? Are you done with the extended D-Wave cycle theory. "Sentiment and cycles" indeed...have their place....but are not absolute. Now that the rules have changed, are we flying by the seat of our pants ?

    AND...anyone who wasnt watching (read buying) AU since lows of late Dec. has got rocks in their head. (Things arent getting better...dont buy the MSM BS). Oversold perhaps, other larger factors caused its move into the low 1500's. This may not be repeated and in fact we may never see that level again.
    Recently I said the shorts were going to get caught...and look what happened !! There is a very large pool of interested parties now willing to commit(perhaps even started). @ 1% of investable funds will cause a $50-100/oz move. Once this gets momentum...@5%....hang onto your hats....it will be a rush of a magnitude and velocity you havent seen.
    I also said to disregard the noise...the only thing to remember is that while the FED exists, GOLD will continue its bull trend and fiat money will stampede to the very bottom.
    We are now very close to a major run on the PM's...where Au could run up to 2100. In fact we could actually get there before end 2Q12. AG may take a little longer but will move to 50-60. Different drivers for AG than for AU but ultimately it will have much better appreciation than AU.
    Words of Wisdom....STAY THE COURSE.
    Do not let weak hands overrule your common sense. Things will get a lot worse before they get better.

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  65. I don't believe there has ever been a trader in the history of the world that has gotten lucky "every time".

    We entered mining positions at just a little over $53 today. Are you still waiting for gold to correct down to $1400?

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  66. I'll go so far as to say anyone who says Gary lacks skills has absolutely no idea what they are talking about. He's a GREAT trader. Maybe not Jesse Livermore great, but he's up there. :p

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  67. Liquid Motion,
    I have warned people in till I'm blue in the face not to sell short.

    However a buy and hold strategy would have caused one to weather a 24% drawdown over the last four months in miners. We have avoided all of that and entered pretty close to the bottom, if this is in fact a bottom.

    So I don't think I need a lecture on buy-and-hold.

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  68. I didn't say I get things right every time. I said when Bernanke speaks, he makes me lucky every time. He's just my lucky charm.

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  69. that gann360 chart is a little creepy...

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  70. Thanks WW, that makes, sense.
    I didn't realize we will still correct some, would have held some of those shorts. :) Appreciate your posts when I see them! The get hid sometimes on this blog on page changes.
    Thanks WW :)

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  71. TZ:

    I know, that's why I asked. "Long and detailed" hasn't stopped you before so I thought I'd give it a try :-)

    No worries if you want to punt. I do my best to read up without having to bug people but I'm reaching the limit of what one can find without real life experience/scars.

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  72. This comment has been removed by the author.

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  73. SB:

    Thanks. Agreed that the points you addressed are not specific to futures. I guess a different way of putting my question is what additional or different risks are there with futures vs. ETFs or options.

    It appears IB sweeps excess cash into SIPC-insured accounts so you'd expect to this cash to be protected even if someone at IB misbehaves.

    As for a futures position, I'm still unclear if the cash you provide to fulfill margin requirements is insured or if 100% of your position is subject to loss. Pretty sure TZ mentioned the cash towards the margin requirement is in fact insured as well but I could be remembering/reading his comments incorrectly.

    Thanks again for chiming in.

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  74. You guys realise that this was the blow-off top in the market, right?

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  76. TZ:

    Perhaps there's an easier answer to just my last question since it's orthogonal to dislocation/counterparty risks:

    To what extent is one liable for the full balance owed on the position? Leveraging up on futures strikes me to be more like borrowing on margin (i.e. if you borrow 50% from your broker to take a 150% position in an ETF that goes to $0 you now owe your broker) rather than buying options (where if the underlying goes to $0 your position goes to $0 but no more). Or is there a different way I should be thinking about this?

    Obviously you should get margin calls as the position value drops or else you get closed out. But in the dislocation scenario of contracts going to $0 there's no room for a margin call. If you're holding stocks or options you lose the full value of the position and owe back any $ from margin borrowing.

    Same story for futures? That would be logical but then again I can't picture some traders levered to the hilt, say 10x, and not only seeing a $100K balance wiped out but then owing $900K to close out the position since futures are a commitment to buy.

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  77. Gary,

    What do you mean?
    Why would anyone go long now that the cycle is so stretched?

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  78. James,
    I'm certainly not going long the stock market. Just gold (miners) because it confirmed the D-wave bottom today.

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  79. INDU CYCLE




    http://traderjoed.blogspot.com/

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  80. The FOMC statement today was bond positive. The fed annoucement amounted to a pretty big downgrade of the economy, with no additional easing offered. This should have meant that risk markets would have traded down - NOT UP!

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  81. Gary,

    You said it yourself, it's time to throw cycle and TA out the window.
    What did i miss anything?

    My question is, how did you come to the conclusion it's time to throw cycle analysis out the window here and declare it a 'run-away' move?

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  82. Has anyone seen or heard from Alex?

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  83. Eric,
    You need to reread tonight's report. Especially the section on confirmation of a runaway move.

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  84. That's what threw me...I was watching TLT rise after the FOMC release and got caught flat-footed and expecting the typical knee-jerk gold rise followed by waterfall decline as per the past F'ed releases (certainly no pun intended)! My best guess is that the 'bubble phase' seed has germinated...

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  85. Statements from Bernanke shouldn't make cycles. The reaction to his comments will be different depending on where the cycle wants to go. The dip in the dollar just mean that it needed an excuse to go where it was headed anyway.

    If not, it implies that cycles will not work until Bernanke resigns..

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  86. Trond,
    The currency markets drive all other markets. The Fed can very much affect a cycle by fundamentally altering the currency market. Look what happened during QE1 & 2.

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  87. And since currencies are a major driver of global asset allocations, contrarian investors can anticipate Bernanke's decisions prior to the speeches, because a market is a discount mechanism.

    Gary said:

    "No there was no evidence that the dollar had topped until Bernanke opened his mouth this afternoon."

    Compare this chart with the UUP or DXY, and you will realise that the USD failed to make a new high above October 2011, and most likely topped in late December by judging it in "real time". Same is true with this chart or this chart or any other foreign currency chart away from European continent.

    In other words, smart money already knew Dollar topped about a month ago and that there will not be any spikes like in this chart on your blog. As a matter of fact, with record Euro shorts, it was the most overcrowded trade of late 2011.

    Chris Puplava, long time precious metal bull (since early 2000s), also figured out last week, prior to Bernanke's speech that the Dollar already topped. Yet... there was "no evidence"... we probably all got lucky.

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  88. Unfortunately no one has a crystal ball. No one "knew" the dollar had topped.

    Like I said all markets were at a crossroads today. Bernanke just pushed the ball over onto the inflationary path.

    You can't seriously manage money thinking that market actions are predetermined????

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  89. Weeks ago I warned of the negative divergence in the dollar on the True Strength Index. It looked though that it would have been corrected had the SPX moved into a DCL.

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  90. 2nd highest volume day on TVIX and another BB crash in the VIX.  Looks like almost everyone is aboard the train.  I'm neither but I sure as hell wouldn't be long the stock market.   TVIX  Chart.  
     SnP bullish% approaching top of the range.
    Bullish% chart

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  91. Hi WW,

    What settings do you use for TSI on TOS?
    Thanks.

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  92. Nothing is predetermined, but market is a discount mechanism. My point is you don't need Bernanke to hold your hand into a long, to be long. Clues are already there for some to see.

    Now, I'll just give up and say that you win here. Reason I say that is because I can see that I'm struggling to convince you, even slightly... even by a remote inch, that there was plenty of evidence there. I guess for you there wasn't and I guess you have your own style of investment, so I respect that. It is what it is.

    As for money managing, I rather not answer those questions because my experiences and pervious performance are bound to be tagged "bullshit" anyway, right? My performance is always on the blog I run, but I post here not about performance, but about markets.

    And to be open about it all I'm long Agriculture as of 12th Dec, Silver as of 30th and Swiss Franc as of 19th of Jan - all prior to Bernanke's speech.

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  93. No BB trade on the VIX although the last one is still active.

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  94. I definitely wouldn't be quick to write the dollar off yet.

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  95. WW, don't u think it's likely we will see a retest of the breakout from the declining trend line?

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  96. It is going to be the 24th day of the daily cycle tomorrow. We will get a cycle bottom sometime soon.

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  97. I expect the dollar will find support on the 65dma.

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  98. According to the cycles, shouldn't the stock market be tanking by now?

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  99. I was talking about gold actually...

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  100. gary
    does the action in the crb index today give any indication on whether or not it put in its low in october. appreciate it

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  101. Apple has a $20 gap to fill and as far as I can see all gaps in the past have been filled AAPL Chart

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  102. Eamonn,

    I actually didn't mean that in response to you :)

    I think its likely gold dips back below the declining trendline if there is a couple day consolidation and then a move into a decent DCL. Maybe a test of the 200dma.

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  103. ww
    hasn't the 150dma provided pretty consistent support during dcls over the last year or so

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  104. James,
    The stock market should have started moving down two weeks ago.

    That may be a clue that something big is happening. Like possibly the three year cycle in the dollar topping.

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  105. Mike,
    If the CRB can make a higher high I would be inclined to call the bottom in the three year cycle.

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  106. Hi WW,
    Thanks for your posts. I respect your trading. Why do you think Gold can break below the 150 dma, after such strong volume today to tag the 200dma?

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  107. Mike,

    The 150dma halted every Intermediate decline except the july 11' bottom (which was early on the 100dma)since this C-wave began in April 09'.

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  108. Thanks WW. U have enough brains for two of me LOL

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  109. Todd,

    Gold is late in the daily cycle and just breached the 150dma today, unless gold moves well above it before dipping into a DCL I dont think the DCL will be so shallow as to just pullback to the 150dma. But we know anything can happen, so we will watch together and see what happens. :)

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  110. Gary
    Not for anything but we had a swing low in the dollar today right? is it possible this freakin dollar topped in 1 day in it's new daily cycle? has there ever been a cycle that has been that left translated?

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  111. No swing today. It was an outside day.

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  112. Haggerty,

    I just recorded the whole Honeymooners marathon, I love it, gives me good flashbacks from when I was a kid.

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  113. WW

    Ahhhh yes but can it core a apple?

    Me too man Loved the honeymooners!

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  114. Haggerty,

    AHHA!!, I didnt watch that one yet..lol

    Hellloooo Balll. :)

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  115. TIHO,

    >As for money managing, I rather not answer those questions because my experiences and pervious performance are bound to be tagged "bullshit" anyway, right? My performance is always on the blog I run, but I post here not about performance, but about markets.

    Well...your performance on your blog starts exactly one month ago in Dec 2011.

    http://theshortsideoflong.blogspot.com/p/portfolio.html

    Clearly that is not bullshit. You are right, I'm blown away by your ability to be profitable for an month. How can we possibly doubt the genius of somebody with a 50 day track record?

    Please continue telling us how to trade and all the things we are missing and don't understand.

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  116. TIHO,

    The people who do this a long time know it is a game about making mistakes (and not letting them take out your portfolio).

    If you got something right in the last week or two then congrats.

    (The best way to bring it up would be to make your case calmly with whatever evidence you have and suggest alternate action.)

    If you keep having differences of opinion in what is going on, then feel free to comment and give your side of it. We all want to be successful and will usually listen. (We listen very often because we KNOW we can be wrong.)

    But anybody who projects rarely being wrong is going to be dismissed because we know it simply doesn't happen. One or two right calls dont give you boasting rights. Stick things out and turn in a few hundred percent in the next year or two and then we talk.

    And further attacking gary doesn't help cause those of us with battle scars know he knows his stuff.

    So what if we didn't get in the dec gold low. Whatever. This is a TEN YEAR+ bull mkt. And the main gains are still ahead. Missing a few weeks or months here and there really wont matter too much. And the killer comment is there is no way to play this perfect. Even buy and hold has flaws.

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  117. Also TZ(8155), no offense but I am not sure who you are, and I don't really care. I come to this blog to wit it out with Gary, who runs this blog. I'm very competitive and to me Financials Markets are a competition between people, so I'm not here to be your friend, just to take your money. I just opened my own partnership company in HK at the end of November. It's been coming for years, so I'm very happy about it. I'm not allowed to show my previous track record coz it's not my company to do so, but even if I did, you wouldn't believe it anyway. So that doesn't matter. What matters is the future and the amount money I make.

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  118. TIHO,

    I did a bit more work and reviewed your blog for Apr 2011 (the massive silver rise and blowoff)

    http://theshortsideoflong.blogspot.com/2011_04_01_archive.html

    There is nothing to indicate you were long or playing silver (which is 80% of your portfolio at present).

    The only comment at all for the entire month that reverenced silver was seemingly:

    APR 21 (about 6 days before the drop started)

    "...Money is once again flowing very strongly into Gold. This indicates, in the short term, that majority of retail investors are once again herding towards an uptrend. Usually, these types of events do not present smart buying opportunities. Daily Sentiment Index (DSI) currently stands at 95% bulls on Gold and 97% bulls on Silver. There is extreme euphoria in the precious metals environment at present, so a correction should follow very shortly...."

    This is hardly a definitive call to bet the farm on one way or the other. And nothing about you holding or selling any metal.

    In a month when silver went up 32% and was the most insane asset on the planet (which is now 80% of your portfolio) I find it lacking that you had a single hedged comment about it.

    Maybe you did extraordinary and maybe your tone is valid, but it isn't present in your writing or performance you list.

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  119. >What matters is the future and the amount money I make.

    Agreed. That matters to ALL of us.

    We welcome your perspective and comments.

    Let us all agree and understand that nobody here will be right (or wrong) all the time. This includes myself, gary, and you too.

    The discourse doesn't need to be as accusatory to other people. (I'm probably guilty of that flaw myself historically).

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  120. WW,
    Thx for answering my question.

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  121. I don't try to be rude, I'm just competitive. I only challenge Gary's view for the sake of always questioning my own, because Gary writes his opinion and sticks his neck out on the front page. That in itself is requires big respect, but doesn't mean I wil agree with it.

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  122. The news today was not a surprise. The reaction was overblown. Wouldn't fight the trend, but wouldn't fall in love either. The charts haven't changed much. We'd need to see a lot more follow through. The $HUI still looks terrible. Was forced out of my modest ZSL position today. That was fun but had to be done. Sitting in cash for a week or so and see how things play out. Assuming the dollar has topped is essentially assuming the EU problem will not lurch to the next level of fear. I'm not brave enough to make that assumption. Seems too much can be gained by milking the problem as long as possible. It's not really about money. It's about consolidation of power.

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  123. WW, many look forward to your trade setups. It would be easier for your followers if you tweet them. That way, we don't need to keep refreshing the page. What are your thoughts? TIA.

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  124. @ SF Giants fan

    "2nd highest volume day on TVIX and another BB crash in the VIX. Looks like almost everyone is aboard the train. I'm neither but I sure as hell wouldn't be long the stock market. TVIX Chart.
    SnP bullish% approaching top of the range.
    Bullish% chart"

    I have been stalking TVIX but have been gun shy due to the dollar.

    Look at the dollar's weekly chart, there is a weekly swing high and a trend line break.

    The dollar is going down.

    Any rally from the dollar coming out of the impending low will likely be short in duration.

    I will wait for the dollar's intermidate cycle to bottom before pursuing TVIX

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  125. I am ready to load up on sqqq and sds

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  126. James,
    The dollar has now registered a failed daily cycle. More often than not that is the sign that an intermediate degree decline has begun. If that were to happen the odds are very high that the stock market is entering a runaway move.

    I've tried till I'm blue in the face to talk people out of shorting the stock market, but I'll try one more time. It's probably not a good idea to try and pick a top in an extremely powerful momentum move.

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  127. Even if the most recent coil plays out according to the odds it still usually generates a 3 to 5 day rally before reversing direction.

    I am assuming there's a reason why this daily cycle has stretched past the normal timing band for a cycle low. The highest probability answer is at the stock market is entering a runaway type move.

    The last one in 2006 lasted seven months.

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  128. Chairman Ben S. Bernanke said the Federal Reserve is considering additional asset purchases to boost growth after extending its pledge to keep interest rates low through at least late 2014.

    http://www.bloomberg.com/news/2012-01-25/fed-says-benchmark-interest-rate-will-remain-low-until-at-least-late-2014.html

    Was busy yesterday, I didn't catch the additional asset purchases part.

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  129. To compare 2012 to 2006 is a stretch.

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  130. This move in gold (in 2 days) is eerily similar to what happened when QE1 was announced... day 3+ was not pretty. I shall wait to add gold.

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  131. one thing's for sure, this bounce has been strong enough to change EVERYONE's mind.

    i agree shorting is a fool's errand (ask this fool here) but i'm reading a lot of "this time is different's" everywhere i look. runaway move now? hmm.

    regardless very tough market. getting long here is hard to swallow and i don't think we're seeing the beginning of the "inflation trade" just yet. but i've had about all i can stands and i can't stands no more.

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  132. SF Giants Fan,
    I'm not suggesting that 2012 is going to look exactly like 2006. Just that if an intermediate decline in the dollar has begun then we are probably going to see the stock market continue generally higher for the next 6 to 10 weeks as the dollar makes its way down into an intermediate bottom.

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