I am totally clueless at the moment, I do not know what to do. I am happy with my entry points, but if gold gets back to 1050. I guess it is time to subscribe to the mighty fine product called RNP. I've been Ok so far, looking at AM's roadmap.
Scenario 1: If I sell my position -> Gold spike to 1500 and Allied Nevada at $10
Scenario 2: If I stay in the market -> Gold crash to 1050 and Allied Nevada at 50c.
Reading all the internet gurus out there, it is a mixed bag of scenario 1 and 2
This guy won me over, pointing out that working against a cycle is like hitting a drive into a hurricane at a headwind of 200-300mph (11min in):
A troll or is he for real, that is for you to decide. It sounds a little bit too simple, almost childish to explain there is only cycles of 3*7, 21 and 42. Hmmm the number 42 sounds familiar, lifters guide to the galaxy perhaps.
That video is an interview with Bo Polny and recently presented at the Silver Summit in Spokane. You said "A troll or is he for real... you decide". Well, I wouldn't see him as a troll whether his cycle predictions come to fruition or not. Troll just doesn't seem the right category of a term to give someone that has at least enough interest to be invited to present at the Silver Summit.
J.Christian also presented at the Silver Summit and troll wouldn't fit him either. Now, ass-hat would fit Jeffrey perfectly.
I made it through 4.53 minutes and then turned it off. It sounded like a politician answering a question but never getting to the answer. When he asks the interviewer if he answered his about where we are in the gold cycle and the interviewer says ok. Hesitates and then moves on. Subscribe to R'n'P.
My advice is do not try to catch a bottom. If gold will move to 1500 USD it won't happen overnight. But it may well move below 1050 prior to that. According to my simple theory ( latest:)) if Russia does not really escalate Ukraine now, we have nto seen the bottom yet as this correction in gold seems to be related ( I posted a chart were tops coincided with Russia in action, or Russia influencing Obama's action) to overpricing the global geopolitical uncertainty after 1999 NATO incursions in Yugoslavia and Russia's reaction to them ( Putin as president, Chechen war Nr 2, etc all that follows after that);
When the price of gold will match or rather - since this is opposite move- go below this uncertainty level that is currently present, we will see the bottom. Now connecting to potential Russian actions, since - I think so - escalation in Ukraine is inevitable after/during March 2015 ( 1 year of Annexation of Crimea etc many other reasons may appear) , the bottom will happen prior to that, but has not yet happened as Russia continues to be quite soft for a moment. Also the USA, Europe is now not pressing, neither is Ukrainian government. Now its words, not actions. Winter and need for gas and hard currency keeps people sane on both sides with USA continuing to posture alone. When heating season- winter in Ukraine and Europe is over, actions will come, gold will start to move up.
Personally, I am looking for dry powder and ways to have it in mid January to deploy it for the big trade. I have some today as well, but bottom is not convincing at all. Of course, can not say about silver, whether it will bottom prior to ( usually) , at the same time or after the gold. Silver might be nearer its bottom which i thing lies at around 13,5 USD than gold.
Me thinks charts tell the same story if you take unbiased view. They are not showing bottom clearly, on the contrary , downtrend ( look at Pinning's drawing few pages ago) has not been clearly broken, and the bottom is not in if we look for symmetrical one with peak preceding trend change in Pinning' s drawing.
TO have a 5 comparable to the upswing before trend change, gold shall move about 10% lower. If there is bull panic then, it could move even 20% down from now before changing trend. 20% down is about 950... so its quite close in value.
And GSR kind of has to hit 80, does it not? around 80 has been the top since 1995 3 times - it has never reached much higher ( 80- 84 is the range), and has not really stopped at below 80 if it has passed 75- which it has this time as well:
To me it looks like silver will hit lows first as gold is sitting relatively well, so GSR 80 would mean e.g. silver 13,5 and gold 1080. Or GSR 84 would mean silver 13,5 and gold 1134 USD. Which perhaps means silver bottom is pretty close...
Thank you SilverRunNW, CarbonJunkie, Green Latern and ivars for your support !
Got an email today from Alex the chart freak, he still thinks that we are in a upward trend. I am not trying to sell Alex here, he is just generous with free info.
Take advantage of the up trend, sell and get back in at the new low, sounds easy. Maybe the low is already in for miners, the selling early Nov was brutal, looked like classic capitulation. I bought it like there was no tomorrow.
AM has not bought any miners yet, not that I know of. Maybe the low for miners is not in yet.
You have to look at what is proven: the October low stands three weeks later, though not quite three full weeks yet. It stands as a higher low in every currency except USD. The rally looks weaker on hourly over the past couple of days, but it is still ok in daily.
Technically: it is taking on some characteristics of a rising pennant, that is to say an interim pause in a downswing which is not completed.
My take is that about now a bearish continuation pattern will fail, and recent purchases were made on the scenario that the October low, which I expected from a ways back, is a prime time for that to happen. But if I'm wrong, I'm ready to do this again in December and end of January to mid-February. But I prefer to think the Jan-Feb event could be a higher low or a breakout to the upside time.
But it is too early to describe that as anything other than supposition of mine. What we have is a two week rally going into it's third week. We can compare sharpness and duration and resistance to drawdowns in this embryonic rally against the rallies which formed (and were taken out) earlier during the bear.
Basically I bought two weeks ago as a knifecatch trade basis long term holdings, but I always trade before trend change becomes visible. It's a dangerous tactic that I am good at. I assess and buy futures trade entry points for long term with wide stops which would inevitably kill a futures trader. If you want conventional long term buy points, what might be called fund management entry points, wait for the 200 day moving average to turn and then hope for a drawdown to buy into. But that would be 150 - 300 dollars higher when it's visible.
Meanwhile all I see among the PM blogosphere is mistrust of the upmove so far. That's good. So maybe it has further to go!
On that, 26-27 Nov, 2 Dec and 8 Dec are likely swing pivots for this rally. The G-V pivots in particular are times when attempts by bears to make gold and silver go down are seriously curtailed in their effect.
Now I know that people are trading leverage, stocks and options but I just don't believe the claims of success that I see made about trading this way by the majority of personal traders. Those claims should come alongside a hard-bitten gritty realism in the same comments which is absent. So sorry if this offends anybody but I expect only one in ten/twenty of self described successful ultra small short term traders to be sustainable over longer haul track record testing of eg well over a hundred trades.
What I do is work in a timeframe and stop parameter which places well equipped hedge fund traders between me and my account and the capacity of the flash crash take your money and run bandits.
My analysis at the moment says if the low is located it does not matter whether PMs are still in a bear or a new bull - a rally is due either way. Only the termination price and date of that rally should vary, which is another analysis problem, one for figuring out later.
On Bo Polny, I don't comment. He is trying to make a living which I won't intrude on. Let some bee-in-bonnet crusading non trader take that up. I have no trouble at all replicating the work of these people and know their advantages and disadvantages as well as I know my own. All I say to you is that plenty of recorded track record is verifiable and don't take assurances made after the fact as truth on any past trading advice. GO BACK AND CHECK FOR YOURSELF! Stated views pre-event versus charts after the period has passed. In the Kitco interview start at 4:30 for testing, Danijela's choice of words all throughout the interview and especially her last question are well chosen.
Solsson, I wonder what CF would have to say about this idea?
Iv'e seen some internet discussions; along with chart examples of GDX and GDXJ showing the massive trading volume that took place when gold broke the 1185 support. According to Wyckoff theory, whenever this occurs, there is usually a secondary test of those lows and on reduced volume.
Would love to see volume information during the 1999 lows? Also, the lows around 2001. As an example, in 2001 we had roughly an 8% rise from the lows from 254 - 274. Prices subsequently came back down to test those lows before moving impulsively higher in the new bull market.
Technically gold and silver broke old lows and pulled back to the breakline, Gold has intruded above the breakline, silver has not. Under TA that's about as clear a sell as you can get.
Now the fact we have already declined so much and for so long should also be taken into account since no trend goes in the same direction indefinitely. Extended trends often make a final false break before reversing. This is an extremely cautionary sign for bears, but technical bulls have very little to work with so far. Technically, the longs are out on a limb and sawing noises can be heard in the background.
No fear no gain.
When prominent Banksters begin saying things like this, I am assured that holding gold is a good idea:
Solsson, I wasn't trying to be mean spirited. And I always enjoy your comments, good disposition and declaring your quandary publicly. To be more complete and focus only on the content I heard after 5 minutes, I asked myself did I learn something I didn't know and did he answer the question that was asked? And I guess he did when he declared a bottom without any caveats. He might not know how to give himself wiggle room in an interview. Maybe he feels to be accepted he must give very rigid predictions.
He spend five minutes giving platitudes. What goes up must come down and vice versa. When silver and gold were near it's high, everybody thought it couldn't go down. Now that's it low, everybody is burnt out and thinks it can't go up. And I guess there is some truth to that and stating the obvious is good to take up interview time but not very enlightening especially to readers here.
And then the topic went into how silver follows gold etc.... Oh yeah, he said something like when time runs out the cycle must turn. What exactly does that mean? What cycle? Of what time length? I am not sure. He gives nothing away about his analysis, not saying he should, or how he arrived at his conclusion. Maybe that happens later. I don't want him to give away his techniques but for me to want to listen more, he has to support his statements.
He went on record to say we were at the bottom (fair enough) and that he told his subscribers to go long over the weekend and it went up. Of course, to his credit. At the end of the day, no heinous crimes committed. All very general. One prediction not supported by much and nothing that made me want to continue. That was the thinking that went through my brain. But than again, I'm getting older and all my synapses' don't fire as strongly as they used to.
No fed charts, no shadow stats, no gov or MSM reports. A different sort of newsflow which to me are some of the best. Just a simple guy, small businessman that makes Irish Flutes. I might have to start visiting the music forums more often to get what's going on in the economy. Too much MSM flow around here.
Am noticing something unusual with Folk Flute orders. Usually these cluster around the end or beginning of the month paydays. Well this time (last week of October and first week of November) it has been quiet. I have picked up a few other orders. It used to be that the pace of orders coming in matched what was reported about the economy a few months hence. If so, this is kind of an ominous sign. Gas prices are falling so one would think people have more money. But I think they are falling due to the recognition that you can only squeeze so much blood out of the collective turnip....
"And GSR kind of has to hit 80, does it not? around 80 has been the top since 1995 3 times - it has never reached much higher ( 80- 84 is the range), and has not really stopped at below 80 if it has passed 75- which it has this time as well:"
Let's dig a bit further back in time, and these statements break down.
Prior to the triple tops at 80 that you mentioned, we had two 100-ish GSR tops, so your statement is not correct.
Leading up to the last 100 top, the GSR reached and then breached your quoted level of 75, before promptly and violently falling to 55, prior to later rising again. In the condensed timeframe of the chart, this drop and reversal look like a brief affair, but it wouldn't have felt like it at the time. Anybody then playing that GSR would likely have believed that the top was in at 75, and missed the final top of 100.
Lastly, there is one fundamental assumption that you make in your forecasting of a higher GSR from here; you seem only to be assuming that it can be achieved from a silver price that continues to fall. Why? It can also be achieved by a static silver price while gold resumes its bull alone, or by metals both rising from here, but gold rising faster.
The GSR is a fascinating topic, but needs to be considered with caution, and a lot of historical perspective. :-)
Well that makes even 100 likely, then. I did say 3 tops at 80-84 after 1995..I think that was correct, talking about current era.
Are there historic cases when GSR tops matches gold bull instead of silver dip? I am not sure about things happening in 2003 or 1996 peaks. But in general high GSR correlates with both metals being priced lower, does it not? Just silver is usually reaching bottom before or after gold, not at the same time, hence its bottom usually coincides with GSR spike? Silver is more volatile, so its price defines really rare ( like >80) tops and bottoms in GSR, usually. Or I am totally wrong here?
Just messin about with crayons and taking plenty of liberties :) I'm sure no serious chartist would pay any heed to my amateur scribblings whatsoever - this nonsense below would see some g/s ratio go into some kind of mad freefall never yet seen on the chart so can be safely ignored as a possibility I think. just sometimes i see things and have to play like a kid on a piece of blank paper with some coloured crayons. Forgive my naievety
1967 was interesting Canada reduced their dime silver content from 80% to 50%. The US moved over to change a little earlier with the coin act of 1965
then checked out 1919 and found this
1920 Canada reduced their dime content from 92.5% to 80% (until 1967). The US stayed at 90% during that time just changing the design. Britain went from sterling (92,5%) to 50% in 1920 (from 1947 there was no silver in any coin - I assume due to being broke after WW2).
Hammer said: " I'm sure no serious chartist would pay any heed to my amateur scribblings ..."
But I pay great attention to the chart you just posted.
I have been making the point to RNPers for the last couple of months that we are in a similar time to teh post World War 2 period where state debts were intolerably high, and also similar to the mid to late 1860s, for two examples of analogous periods.
In the recent RNP webinar I desribed in some detail that the UK is buying back for cancellation non-redeemable-dated Churchill War Bonds yielding 4% because they are too expensive to service. The last time they did that was 67 years ago! 2015 - 67 = 1948!
A prior time low yield consols were issued was to finance the Napoleonic War which was done by (as one of two partners) the Rothschild family, so there is your circle completed, including: international war to international war, old bank-state relationship to renewed version, long term yield cycle, and previous period of negative real rates to return of same.
Check it, stocks went up, financial repression, depressed wages due to returned workers and women introduced into the workforce (illegals' amnesty sound familiar to US readers?) and a negative return on the aforesaid War Bonds, or as they were called then, Consols. A study of the debt-interest cycle is very interesting because it reveals what happened when all this came about before. And the top guys are so smart they are doing it all the same, but with modern tools in the modern context.
So when were low yielding government bonds issued in the past and what happened after? The swing up in yields takes approximately 32-36 years, which allows two 18 year stocks and one 36 year stocks cycles to fit in one debt bull or bear market.
Thanks for the post and illustrative chart Hammer.
Until 2008, there was what could be construed as reasonable mirror-like symmetry on the chart centered around the 1965-67 mark
2019 not impossible date for next gold high. By that time it should be clear that Russia will lose its war with China so gold war premium will start to decrease. I assume Russia will attack China or vice versa around 2017. The intent of Putin is to do it 2019/2020 when Russian rearmament program will be finished, but Chinese know as well that starting this war earlier would increase their chances to sure victory tremendously. Same old story as was between Germany and Russia. Hitler planned to attack Russia in 1943-1945 before competitors rearm. He was forced by Stalin to attack earlier, and that cost him Germany, and it cost Germany its sovereignty after 1500 years or more of sovereign German tribes and princely states and finally Empire.
So yes, 2019 is Ok ..as it will become clear Russia is going to lose, gold price will move down as USA and China with Europe and India on margins will undertake rebuilding of new monetary system...not based on gold, of course, at first, on paper remnibi, USD.
I was thinking earlier it may be 2017, but then Russian advances will not make China a clear winner yet, so gold may fluctuate near top until second front in Europe/ Middle East is started by the USA. Which may well be 2019 as USA will stay out of this war again as long as possible. I guess the factor which will draw USA in this time will be someone attacking Israel.
Good work, Hammer!
So, the big trade looks like starting early 2015 and ending 2019. Not bad. Only I will be in occupied territories for part fo that time...not sure how to avoid that and were to place immense profits from the big trade:)
JPM is first that comes to mind, USA branches. Do not know though whether they allow citizens of other countires to open accounts.
QE since 2008 (which is the bit that is bugging me from a symmetrical perspective - that may very well just be me looking at it in a completely wrong way mind you) has pushed out the timings, so it may be further out than that ? Or, possibly result in a much bigger faster snapback than history has suggested so far from the chart available anyway ? More questions than answers as always but great fun to stretch the liddel ole grey cells from time to time - keeps the mind young and healthy and that is more important than any old chart done with a couple of thick crayons :)
P.S. Timeframe wise if the symmetry does hold, it would be before 2019 Ivars.