The setup for the big trade

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Sat, Oct 5, 2013 - 12:53pm (Reply to #3392)
eclectic
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God is money.

This may be the most important post to date on this thread.

Sat, Oct 5, 2013 - 1:01pm
eclectic
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The Elliot Wave Bearish Case For Gold

“It might take longer than you think.”…..quote from A.M.

It was A.M. who first posted a chart-- along with commentary-- of the 1998 bear market in gold. He obviously thought it significant to analyze that time period. The year 1998 encompasses what some Elliot analysts say was a final ‘C’ wave down to the final lows in 1999/2001. What I did was to evaluate the 1976 bear market and discovered there were striking similiarties of the ‘C’ wave during that year; down to the final low in August.

Both C waves for each bear market contained a total of eleven (11) waves before the final lows. Applying that same blueprint, there have been a total of ten (10) price ‘thrusts’ (up and down) to date for the current C wave in progress from 1796 recorded on 9/30/2012. Now, let’s look at the current price structure to discover possible Elliot wave counts and alternatives. I think there are at least three (3) possible scenerios regarding future price action. We are currently either:

  1. In the final wave 5 of C,
  2. In the final wave 5 of C which can take the form of an ending diagonal,
  3. In wave 3 of 5 of C.

Note, case (1.) calls for one more new price low and would meet the minimum requirement of a total of eleven (11) price thrusts. Case (2.)--the ending diagonal--calls for the completion of thirteen (13) price thrusts; or two more new lows. Finally, case (3.) also calls for the completion of thirteen (13) price thrusts—two more new lows—but at subsequently lower price levels.

If any of these bearish cases begin the pan out; I would then be looking for a point in the future where price meets time within a pre-defined time window for the final lows and the setup for the big trade. This time factor is the subject of another discussion.

Looking at the current news and macro fundamentals; some believe the final lows are already in place. Still it seems the more compelling the argument for being long gold—and the more bullish the news—prices keep declining; and the main trend remains down. This following article is a case in point.

https://www.kitco.com/ind/Saville/2013-10-01-Another-Nail-In-The-Coffin-Of-The-Deflation-Case.html

Prove me wrong Mr. Market: prove me wrong.

Sun, Oct 6, 2013 - 10:36am (Reply to #3412)
eclectic
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My apologies for.....

being too hasty and not proofreading. Should have read: Gold is money. Also, the comment was

poorly worded. I can't find the words at the moment, but A.M.'s post strikes at the heart of the matter

on why gold is important. The following link provides a better explanation. Cheers.

https://www.zerohedge.com/article/future-money-trends-why-gold-money-kin...

Sun, Oct 6, 2013 - 11:15am
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Nice post Eclectic!You

Nice post Eclectic!

You summarized (in elliott wave terms) three of the scenarios that I consider likely outcomes in the medium term.

The other two:

  • we bottomed and did wave 1 up, and are in wave 2 down to retest the low
  • an expanding pattern wave 2 decline from 2012 which may or may not be completed yet.

In all the cases - I mean where EW is concerned - I await more market action not really to confirm where we are which is asking too much, but hopefully to exclude one or more EW alternatives.

argentus maximus Rhythm and Price https://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Sun, Oct 6, 2013 - 12:03pm (Reply to #3415)
eclectic
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Coming from you sir....

I take that as a compliment. Regarding your first point on gold, the move up off the June lows look like a (5-3-5)

zig-zag correction; when broken down into the lower wave degree classification. But, this is hard to reconcile with

silver because wave 1 off the June lows look clearly impulsive. Maybe your wave 2 down to retest the low could

take the form of a failed (truncated) wave 5? As you say, time will tell; so let's see what happens.

Sun, Oct 6, 2013 - 2:50pm
ivars
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Now with debt ceiling

Now with debt ceiling appearing in Boehner language as "possible", would be very interesting to see if, how markets react, especially silver, and gold. Can give clue how seriously markets take default and what is the first direction they move to. Out of short term bonds-that has already happened-I read so far only of 2 month bonds. Do not know if these markets are big enough for money out of them to be looking elsewhere. If bonds get cheaper will pension funds be back buying them? What will they sell in turn?

I am still short silver since 21,85 which has not moved anywhere over last week.

Any future development must involve changing something which people have never challenged up to the present,and which will not be shown up by an axiomatic formulation. P.A.M.Dirac
Sun, Oct 6, 2013 - 4:57pm (Reply to #3415)
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typo alert ..... that should

typo alert ..... that should have said: an expanding wave c decline from end 2012 ....

argentus maximus Rhythm and Price https://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Sun, Oct 6, 2013 - 8:05pm (Reply to #3412)
redwood
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"God is money".....nice slip,

"God is money".....nice slip, I like it too and I'm not even religious.

Mon, Oct 7, 2013 - 7:58am
It's a mystery
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Curious Development

Notice that GDXJ is getting creamed pre-market?

The largest holding, inexplicably, is a new company called LionGold. Well LionGold was halted last week along with two other commodity companies and its shares promptly were smoked when it re-opened with the other two today.

It is VERY ODD that these companies were looking to make aggressive acquisitions and all of a sudden regulators came in and effectively destroyed their stocks by halting them on NO NEWS.

https://www.bloomberg.com/news/2013-10-04/sgx-suspends-blumont-liongold-asiasons-as-stocks-plunge.html

So there's more. LionGold wanted to buy Minera. IRL.TO for those that use stockcharts. Very promising junior being given away.

I smell a rat.

Mon, Oct 7, 2013 - 11:09am (Reply to #3420)
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Miner comment

@IaM - Here's a comment lifted from ZH that might be some news you haven't seen yet. It looks like it might be time to jump on some miners. I got lucky a couple a years ago on a pump and dump penny stock miner, the most profitable trade in my entire trading "career." Like a cargo cultists waiting for another box to drop from the sky, I am waiting for another miner to pay someday.

China is moving faster to diversify from US dollar holdings already:

McEwen Mining & TNR Gold: Las Bambas Copper Bidding From China Heats Up

“It is a good choice to invest in mining assets, which is a much better choice than investing in one government’s bonds – especially when this country cannot guarantee to pay even its own employees”

Gu Liangmin, head of copper at Minmetals.

The quote above can be the one of the year and you can spot the trend now. It is getting more interesting by the day: Mining.com reports that now third Chinese company has entered the bidding "Art of War" for "Glencore Xstrata's (LON:GLEN) much-coveted Las Bambas copper mine." Situation is getting more and more industry attention now and Lumina Copper closed yesterday at 4 month's high of CAD5.72. We are waiting when the market and analysts will pick up this story and translate Los Azules Copper project value for McEwen Mining and TNR Gold.
Update: Lumina Copper has printed CAD6.55 today - we hope to hear some good news from the company soon. https://sufiy.blogspot.co.uk/2013/10/mcewen-mining-tnr-gold-las-bambas.html#

Mon, Oct 7, 2013 - 1:17pm (Reply to #3420)
redwood
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Somebody has a very large

Somebody has a very large foot on miners today. Yes, yes it is Monday and things invariably start slowly at the beginning of the week but as a percentage rise of the metals, miners are crappy today. Probably as a function of equities underperforming, but the miners' performance is still poor nonetheless. I won't sell anything as I also think a rat is lurking.

Mon, Oct 7, 2013 - 3:51pm
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The silver chart is

The silver chart is fascinating today.

At this early stage, the turn seems to have acted as a low, or an accelleration point. If there is not a reversal pretty much immediately we are in for a decent move. The inflection just passed now has a single up day in place, and several to go before the next expected turn on this scale.

With 1 up day in, it's too early to call, but looking back to the last inflection of this cycle, the proximate high and low followed by a non directional sideways swing allow for interpretation both ways when we arrived at this one.

I will try to figure out some factors in gold to confirm or refute the possible inversion and upswing of silver, but following whatever trend emerging from inflections with a following bar breakout, or following 2-day bar breakout is a simple and practical approach.

I remind readers that I am still long for the daily and weekly chart timeframe.

argentus maximus Rhythm and Price https://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Mon, Oct 7, 2013 - 9:55pm
T
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Heres gold now

............ in the asian session, holding up at 1325 area and looking like it wants to go higher.

After a rally today that is showing this momentary ' bottom looking ' zone around 1305 , makes a nice looking move to 1329/1325 area.

what does this daily price action mean. I think it means nothing. just zig zag noise , in a middle zone, that ranges from 1270-1370, with a narrower range between 1300-1350,.

There is little to forecast here at these prices. the 'right shoulder' zone is still in play at the 1350 area.

There is no proclamation that said 1270 is a firm support zone. its just where the latest bounce has happened.

and i'm only writing this because I'm bored.

Mon, Oct 7, 2013 - 11:39pm (Reply to #3423)
Rui
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Non-confirming SLW is a problem

It moved up barely 0.7% when silver rallied 2%, which just does not spell confidence especially when we look at how this flag-ship silver miner traded in Jul-Aug during last rally. Let's hope it catches up on Tuesday w/ FOMC looming on Wed.

Silver needs to hold above (or at least stay close to) 50DMA for one more day to establish a bullish case.

Tue, Oct 8, 2013 - 12:17am
Rui
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Gold looks better than silver, COT-wisely

This is based on Sept COT as we don't have Oct COT yet. Notice how low few shorts big banks still have while it's the SWAP dealers doing most of the shorting. Big banks are low on shorts in silver COT as well but not as outstanding as gold. (Right-click the images and choose to view them in original size)

Tue, Oct 8, 2013 - 12:23am
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SLW is noticeable

Rui, interesting to think about SLW today, but for a few reasons.

A quick glance at the metals and miners today would show that Silver did pretty well today and silver stocks did ok too. silver seems a bit stronger that gold these days .....and then we look at SLW, a bit lame.

But at first when I looked at SLW , in comparison to other silver miners.... you can see that SLW has held up better than the miners during this pull back.

Silver Miners are at a bunch of different pullback levels. some like FSM and SVM are a bit higher than average , and some like CDE (Coeur de whatever) has really collapsed. SLW is way up at the high zone.

so today's lame movements might not mean too much.

SLW needs a Big pullback for me to become interested in buying any real pullback.

Tue, Oct 8, 2013 - 12:37am (Reply to #3427)
Rui
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In terms of SLW pullback

23.5 is the 50% retra for SLW. Perhaps someone is waiting over there?

Generally we need buying volume in both GDX and SLW to confirm this higher low, otherwise metals would keep dancing here until their next decisive move.

Tue, Oct 8, 2013 - 9:46am
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Thanks for the COT charts

Thanks for the COT charts Rui.

Here is an interesting daily silver chart basis the Euro cross:

The volume at price is the red histogram on left side of chart, and silver has just filled a huge gap in the 16 area.

A volume at price (16.76) gap looks like it is about to get filled pretty soon.

argentus maximus Rhythm and Price https://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Tue, Oct 8, 2013 - 10:27am
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GDX

Anyone think that GDX is a bunch of global buyers and sellers trading against one another? Comical. There is a do not pass go sign on the algo today. How long does it last?

Tue, Oct 8, 2013 - 10:29am (Reply to #3430)
redwood
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Yup.  We should know better

Yup. We should know better by 11:30 -12:00.