Pailin's Trading Corner

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Sun, Sep 25, 2011 - 8:20pm RedRover
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might have been right about gold

globex dec gold open 1660; high 1664.30 a few minutes ago

oops!...just got off the crapper...high 1666.30

Sun, Sep 25, 2011 - 8:46pm
CK
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Silver at $30 is the most

Silver at $30 is the most obvious long term buy ever. Doesn't mean it can't fall to $25 or even $20 or less... it just means it would be a buy there as well.

Stack physical. Maybe some long term hail mary options if you're willing to add to them if/when they lose value.

Good luck - watch the Crossing MA's :)

Btw- I'd clearly think it's time to wait for this market to calm down before getting involved in leveraged paper. We don't know how ugly this can really get yet.

We're not trading against the market, we're trading against ourselves.

Sun, Sep 25, 2011 - 8:55pm
Silver_Watchdog
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'Dexia bank prepared to sell

'Dexia bank prepared to sell £12.58 billion in assets': Beware as this could include gold/silver assets.

Sun, Sep 25, 2011 - 9:05pm
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I'm sure Dexia would sell

I'm sure Dexia would sell their PMs--I just don't know if they have any

Sun, Sep 25, 2011 - 9:21pm Rico
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If the paper market is

If the paper market is leveraged 100:1, then that's an overwhelming amount of trading power.

Sun, Sep 25, 2011 - 9:31pm Silver_Watchdog
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Silver_Watchdog wrote: 'Dexia

Silver_Watchdog wrote:

'Dexia bank prepared to sell £12.58 billion in assets': Beware as this could include gold/silver assets.

This is how it starts getting cute, when banks sell assets and they forget they're "custodians" not owners! Maybe not Dexia, but if this is the way it's going to be I think we will see the headline (maybe only on ZH though) where a Big Bank is being sued because their bullion vault was emptied to satisfy a big counterparty claim (like China CB or India CB or Russia CB or ???) and the actual little guy unallocated (!) owners got cashed out "fair value" in fiat at closing spot price of the day. Or better yet the bank zeroes the mortgage they also hold for the customer and hands the title back to the now ex-gold owner. Ya know, that underwater mortgage :)

All of a sudden you own "in full" a crappy house you can't liquidate easily (or even fairly value) in exchange for the most liquid of all assets...physical bars of gold/silver. If you're in Europe, you might have even been allowed to secure the mortgage by putting the metal up as collateral to begin with...never thinking it would get called away from you. Call me nuts, but...

Get me?

Sorry for going OT but it just struck me how easily it all could just slide in that direction pretty fast.

To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey
Sun, Sep 25, 2011 - 9:34pm
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Failure to short the bounces

Failure to short the bounces going forward (especially the miners) is to bet against the near term trend. Which is profoundly bearish.

I see a five percent bounce, I short.

Trapped longs are still hanging on. They are looking for any chance to get the hell out. Weak hands will undercut any sizeable bounce in the near term. Just look at the chart from fall 2008. Let history be your guide.

Sun, Sep 25, 2011 - 9:58pm pailin
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It would probably cost an

It would probably cost an individual or institution too much money to litigate against a bank then what it's worth. They'd be better off receiving a premium and buying other assets or going allocated elsewhere. With that said, I would presume that we are seeing LBMA unallocated accounts flee in order to buy Pan Asia's RMB 1:1 spot contract expected to be launched in the coming months. Although the exchange has not launched yet, accounts are being setup allowing brokers/clients to exchange RMB funds before hand.

It's going to be a rough ride so hang tight.

Silver Watchdog

Sun, Sep 25, 2011 - 9:59pm
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RE: Shorting Bounces

SSK,

Exactly what I was trying to say. History and the markets (e.g., copper, CCI) are telling us that deflation is the near term trend despite, or in spite of, Operation Twister II. E.g., SLW put in a H&S top and is now correcting - a telltale sign.

I expect the miners, and the market in general, to have a small bounce then it's lower bounces down the cliff from here. And this won't stop until the markets correct all the misallocated capital or Uncle Benny comes to the rescue with QE___ . I expect the latter, then it's off to the hyperinflation races. But those are just my thoughts and I have been wrong before. Thankfully, I have been right at least 51% of the time.

Sun, Sep 25, 2011 - 10:04pm SSK
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SSK wrote: Failure to short

SSK wrote:

Failure to short the bounces going forward (especially the miners) is to bet against the near term trend. Which is profoundly bearish.

I see a five percent bounce, I short.

Trapped longs are still hanging on. They are looking for any chance to get the hell out. Weak hands will undercut any sizeable bounce in the near term. Just look at the chart from fall 2008. Let history be your guide.

We'll know better when we see the COT report this Friday. And yes the 2008 period shows some pretty bearish action. https://i56.tinypic.com/wr018k.png

Sidenote: Shanghai Futures Exchange also raised their gold margin to 12% from 10% starting tomorrow.

Sun, Sep 25, 2011 - 10:20pm beemer
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Beemer,Don't sell yourself

Beemer,

Don't sell yourself short. Think about it, you are stacking precious metals which puts you in the top 90 percent tile (probably much higher) of Americans. It's one thing to know and another to to act upon that wisdom. I think the more you read and listen, the more you will reassure yourself that your decision to purchased gold and silver was the right one.

I agree that there are many very talented individuals on this forum that have taught me alot about technicals and valuations and continue to learn. However, there are many tremendously successful investors in the precious metals and resource sector who do not use technical analysis what so ever. And often they call the markets and trends as well as the most adept technical analysis. That's because they are looking at value before it is reflected in share price or commodity prices. They are not concerned about tomorrow because they are looking for growth over a longer period which often yields quite impressive results.

This is not to take anything away from any model or paradigm individuals use to get their head around what's happening in the market. Just to show you that you might find another way that fits you better. And realize that there is no dirth of individuals around sharing their technical insights that you can take advantage of. If you're playing the long term trend, it almost doesn't matter that silver and gold is down or up tomorrow.

Sun, Sep 25, 2011 - 10:24pm
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Franklin Sanders did my

Franklin Sanders did my homework for me this weekend: he looked back at the 2008 crash, plotted the carnage.

Some highlights:

"** from the August break to the November low 97 days passed. The SILVER PRICE topped 5 March 2008 at 2068.50c, then

**fell to a 1 May correction low at 1612c

** rose to 14 July at 1917.5c, then dropped gently and

** broke on 6 August at 1650c into a waterfall

** plunging to 1049c (down 36.4% in that break) on 11 Sept,

** dropped more, then rose to 1345.8c on 26 September, and

** fell to double bottoms 28 Oct and 13 Nov. at 880c,

down 57.5% from the March peak.

** From the August break to the November low, 98 days elapsed."

Didn't have a bounce in 2008 with any staying power until end of December/first week of January. My point is that, history being your guide, price will not turn around this week or next week or even next month. Every rally off the "bottom" will be sold hard. Shorting the bounces should be strategic going forward. The first real bounce, lay down the DUST, DZZ and ZSL.

Here is Franklin's site. Guy's been around forever. Worth a read a couple times a week.

Sun, Sep 25, 2011 - 10:36pm
Titus Andronicus
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covered my shorts

I covered my shorts.

I picked up deep-out-of-the-money puts. I cannot afford my silver stack to be unhedged in a nightmare scenario.

My guess is that gold/silver will either:

1) Go up.

2) Go down.

3) Be flat.

I don't see any other options at this time.

Sun, Sep 25, 2011 - 10:44pm Green Lantern
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Thank you Green

Thank you Green Lantern,,,,you are very correct, as I do try to understand exactly what is going on , what will happen next and all the things that are affected by each and every move.I am seeing that everything that happens holds consequences,if the dollar goes up it affects other things . Albeit G&S are taking a beating ,yet I just read in FT that trillions will be needed to support the EU banks to stop contagion,,,this has to happen in the next few weeks alas the presses will have to run at full speed ahead aided and abedded by the IMF. We know that the economy seems to be on a deflationary spiral,with ALL commodities .It will not last forever,,,,

Jim Rickards said to always remember when the chinese yuan is revalued up to look for inflation shortly thereafter .

Brenda miller
Sun, Sep 25, 2011 - 10:49pm
DefiniteMaybe
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SSK, TITUS

@SSK: Me thinks this Sanders fellow co-opted my spreadsheet that I posted above. His price points are only off by a day or so from mine. Hmm... I'm crossing my fingers for a slight bounce. If not, I will have to respond accordingly. Given the new margin requirements in silver futures, I don't see silver heading up in a substantial way anytime soon. Just my take on things.

@Titus: LOL So you have a strategy in place for each of those calls? :)

Sun, Sep 25, 2011 - 11:03pm
Irene
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GLL

Hi all. Wondering if any of you are currently in ProShares UltraShort Gold ETF (GLL)? Thoughts?

Sun, Sep 25, 2011 - 11:04pm
SSK
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Gainesville coins just closed

Gainesville coins just closed up shop for the night. Might have to do with the 29.50 silver.

Gainesville Coins is currently performing routine updates to the website in an effort to improve your shopping experience. We apologize for any inconvenience. If you need assistance, please contact a member of our staff at 813.482.9300.

The website will be down from 6:00 PM September 25, 2011 - 9:00 AM EST September 26, 2011.

Yeah right. Routine updates. Uh-huh.

Sun, Sep 25, 2011 - 11:49pm
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30 29 28 27 26 25

30

29

28

27

26

25

Mon, Sep 26, 2011 - 12:10am
SSK
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Santa: "Market situations

Santa:

"Market situations like this will be found to have held and created bear traps in several instances of similar pattern action over the past 30 years WITHOUT having continued further down to first major support. The current corrective pattern over the past 23 trading days strongly implies that the move below $1690 would continue on down to the core at $1665 at minimum as first bottom, and in the extreme to $1615, but not below $1584. This will happen prior to exhaustion and a return to the full bull trend."

I think we are about to test in the extreme but now below.

Mon, Sep 26, 2011 - 12:17am
CK
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Man this can get really bad. 

Man this can get really bad. If silver falls under $28-$28.20 I really wouldn't be surprised to see $26 silver later today or tomorrow, or whenever it breaches it.

We're so over sold but it doesn't matter anymore. Gold really looks like it might go to to the 1580-1550 level. If we fall off from there, run for your lives :)

Going by basic charting with channels,etc. And knowing that super strong sell signals have been given on both.

I wouldn't mind seeing silver at $20 or below and gold under 1500 to wherever it would fall. Not that the market cares..

We're not trading against the market, we're trading against ourselves.