“Woe to the land whose king is a child and whose leaders are already drunk in the morning. Happy the land whose king is a nobleman, and whose leaders work hard before they feast and drink, and then only to strengthen themselves for the tasks ahead”. (Eccl 10: 16-17)


"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat


Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


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Thursday, March 27, 2014

Dollar Rises - Gold Sinks

Same story as yesterday - The US Dollar is gaining some ground at the expense of the Euro and that is undercutting the bullish case for gold.

Geopolitical concerns are still lurking around due to events in Ukraine but as long as the market feels that escalation dangers are limited, safe haven flows into gold are waning.

Gold has now dropped $100 since making a try at $1400 on March 17. That proves the old adage that markets tend to generally fall faster than they go up ( this is not an "always" thing but it does seem to occur more than the reverse). In the case of gold, the market moved up almost entirely on worst case scenarios of WWIII, Russian moves out of the Dollar, a new Cold War, etc. None of these events have panned out exactly as their proponents have suggested they would.

This is the danger inherent in rallies which are predominantly driven by short covering as was being noted here. Once those buyers are run out, who is left to chase the price higher? Gold needed to see FRESH speculative interest coming in from the hedge fund community and it was not getting it; especially after the FOMC gave such a hawkish view on the US economy and proceeded with their tapering plans.

In watching the price action closely during the session, gold managed to claw its way back off the worst levels of the session when the stock indices initially weakened early today. As the equities then moved higher into the plus column, gold began moving lower again. Right now, as I type these comments, the equities are once again weakening a bit but gold is actually moving lower, along with silver I might add.

The HUI was actually higher early in the session but has since then given up its gain and has turned negative. Its losses however have been contained at this point although that could change by the end of the trading day.

Take a look at the following chart of the HUI. Note a couple of things on the Directional Movement Indicator. First, the -DMI ( Red Line ) has crossed back above the + DMI ( Blue Line) for the first time since the month of January. The bears have regained control over the market. Notice also that the ADX line ( Dark Line ) is showing some signs of turning higher suggesting the Potential for a trending move lower. I think we would have to see a downside violation of the 210 level however for this to occur.




I want to also note that much was made on some sites about the so-called Golden Cross, where the 50 day moving average crosses above the 200 day moving average from below. Many technicians regard this as a bullish development. For such an event to actually mean something, it is usually understood that the price of the underlying security ( in this case the index ) must REMAIN ABOVE both moving averages. That has not been the case here with the HUI. It has fallen below both moving averages just shortly after the time the Directional Movement lines reversed signaling the Bears were grabbing control of the market once again. In other words, any bullish signal from that event has been negated.

This underscores the rapidity at which markets move nowadays and especially markets which are driven by geopolitical events. Here is a bit of trading advice - unless you are very fast on the draw and spend significant amounts of time sitting in front of a computer screen watching prices and events, leave markets driven by geopolitical events alone. They are too dangerous for all but the professional traders who can move more quickly than the average screen watcher. Yes, you might miss a great opportunity for a big profit but you also risk suffering from severe losses. Just ask any of the bulls who bought up near $1390 who were just convinced that the West was going to level sanctions on Russia after the results from the Crimea region came in over that weekend a while back.

Also, never base a trade ( or an investment ) for that matter on a headline. NEVER! Let the market technical price action do that for you, AFTER you do some research on your own and not rely on the predictions of some "expert" who makes his or her case about why such and such market is going to the moon.

Remember, markets are based on differing opinions. Some are bullish; some are bearish. But keep in mind that they are just opinions and in that sense, guesses as to how the market might respond to a particular scenario. The only true proof consists of the price action. It either confirms or validates ones opinion or it does not. It really is that simple.

Traders who quickly realize that the market is not accepting their opinion and get out of the way become survivors and experienced traders. Those who want to blame other forces ( manipulators), etc, and whom refuse to get out, become former traders with a lesser net worth.

All that matters in this profession is whether or not you make money; not whether you were "right". You are only "right" if the market confirms you are right. Other than that you are just a guy with an opinion that meant nothing. Period. Humility is a virtue that will serve to protect you long after pride has made fools out of prognosticators who keep serving up one dogmatic prediction after another.

"Put not your trust in princes, in mortal man in whom there is no salvation", says the Psalmist. Wiser words were never recorded.

Here is a Daily Chart of Gold to close out these comments. I have noted the "Golden Cross" on the chart for your convenience. That is the 50 day moving average in green crossing above the 200 day moving average. Note that price has fallen below both of these moving averages, a bearish development. Typically in a strongly trending market to the upside, price will remain above these levels.
 

Bulls do have a support level within the general vicinity of that cross which comes in at the 50% Fibonacci Retracement Level at $1287. They only missed that by a few dollars today. If the bulls can reverse today's losses tomorrow to close out the week, they have a chance at stabilizing prices here. If not, and if $1287 gives way, there is some light support near $1280. After that, $1262 - $1255 is the next target.

For Gold to get some recent Bears nervous, it will have to regain its "13" handle for starters. If they can manage that, some of the shorts will go ahead and ring the cash register and move back out.






78 comments:

  1. great thinking as usual Dan; you have to go with the technical, as the fundamentals are day in and day out manufactured; sparks; sad but true, just look at the California scandal breaking in SF and also with the scummy CALPERS; stay short Yen sports fans; sparks

    ReplyDelete
  2. Dan, it is impossible to log comments with these impossible letters lately; tell the pinheads to go back to simple numbers; sparks

    ReplyDelete
    Replies
    1. Steve;

      Can you clarify that last comment? I am unsure what you are getting at.

      Thanks

      Delete
    2. after I reply they show a bunch of screwy letters, instead of numbers; takes 3 times to get it to go through

      Delete
    3. It's easier to decipher if you smoke a big fatty furst . . . . .

      Delete
  3. Singapore metals exchange prices still pretty much moving in lockstep with COMEX.

    The entire globe has been liquidating gold in a panic the last 10 days.

    And the recipient of this cash are the same old, time tested bastions of safety:

    - TLT has now cleared to 9 month highs, 10-yr. yield now down to 2.67%

    - German Bund 10-yr. is 1.53%

    - JGB 10-yr. is now a paltry 0.67%

    - Both JNK and LQD is now 50 cents away from world record highs.

    The world is awash in excess bullion, yet sovereign paper is in acute short supply.

    Stay in the system.

    ReplyDelete
    Replies
    1. Did you notice how the chairman of the advisory board now calls himself executive chairman?

      What psychological damage one must have incurred to end up with and ego and a total and utter disregard for truth and other people.

      I suppose that 2000 gold in 2014 is not going to be so easy.

      Every single top must be pumped. Each one.

      Delete
    2. mark, you are a better man than me if you can put an 8 in front of the june palladium; sparksl

      Delete
  4. jasper, come on, 2000 gold this year? And I am from the government and here to help you. sparks

    ReplyDelete
  5. Hey bo polny the new goto man sais so on mineset. And we all know how jim is here to help so its gotta be true.

    ReplyDelete
  6. Jasper

    Hey what happened to Lars, Armstrong,and all the other chart monkeys formerly featured who had parabolic price projections going foward to $2,000 and beyond? And who is this Bo Polny guy? Just wondering where he came from. These guys always seem to come out of nowhere as unknowns and suddenly they are hailed as eggspurts, lol....

    Can you imagine a guy with a name like Bo Polny being featured as a guest on Bloomberg or CNBC??

    ReplyDelete
    Replies
    1. He will be a guest if gold goes up from 1400 to 2000 during the last week of 2014 :)

      Delete
    2. Mark; Bo Poiny and Jim Willie were married last week; their best man was an oak tree; sparks

      Delete
    3. You have plenty of reason to be upset with the the permabull hucksters over at Kingworldnews. When you add Martin Armstrong to that list it only shows how little you know about him. Martin is in the same class as our beloved Trader Dan, a good man and a teacher. Let's keep this blog about learning and making money not bashing and trash talking please. As Samuel Clemens once said.." It is better for people to think you are a fool than to open your mouth and remove all doubt."

      Delete
    4. "Let's keep this blog about learning and making money not bashing and trash talking please."

      Exactly.

      Delete
  7. what chart software/sites do you guys use? any recommendations?

    ReplyDelete
  8. Golds down move today was NOT confirmed, at the close, by GDX, GDXJ ( Up 3% ) and ^HUI. If this continues for a second day then the implications could be positive for the future.

    ReplyDelete
  9. No recommendations for charting software? Currently using freestockcharts (because I hate etrade pro)... Any suggestions are greatly appreciated :) Thanks!

    ReplyDelete
    Replies
    1. M Resnick;

      There are many software packages out there that you can use... just a few - Tradestation, Metastock, Esignal, Thomson Reuters Eikon, but they all are not cheap.

      Delete
    2. If you don't need shorter than daily timeunit, prorealtime is 100% free.
      For faster time units, I use those on my trading platforms, but they are not so great usually. Still if you say you want to open an account there, many have a "demo" platform for free integrating such tools on shorter time units, but as I said, probably not very good.

      Delete
    3. Thank you both so much for the input! And, Dan... seriously, you have completely changed my perspective when trading... Your blog/site/info is hands down the best resource I have found to really learn the fundamentals of technical analysis and sentiment. Cannot thank you enough for the time/effort you put into making this info available to dummies like myself :)

      Delete
  10. Of course Dan options expiry had nothing to do with it. Gold is just like orange juice or soy beans....yea right. My prediction, gold starts moving up tomorrow or Monday.

    ReplyDelete
    Replies
    1. Hey Got It WRONG!!! you just can't get away from this "excrament of the site" as you called it. Why don't you go and make tons of dough predicting tops and lows in the miners. LOL!

      Delete
    2. Abraxas, like I always say, most speculators like Got it Right, deep down inside are wanting to lose; usually they do; sparks

      Delete
    3. Got it Right, it's not only options expiry, but end of the month, end of the quarter, after a loss of 100 $ on gold.
      If some shorts take their profit here and now, gold may go up without the need to interpret it as a manipulation before the options expiry date.

      Delete
  11. http://blogs.marketwatch.com/themargin/2014/03/27/used-guillotine-for-sale-going-une-fois-going-deux-fois-no-deal/?mod=MW_latest_news
    Fitted for all sizes, make central bankers feel warm and fuzzy, let's roll.

    ReplyDelete
  12. ACI chart just did the Golden Cross this week on high volume; a good technical omen by itself but even more significant that it came on massive downgrades of coal stocks from Jeffries, UBS etc. Something to watch.
    ( No doubt they call them ANAL_cysts !).

    ReplyDelete
  13. Great analysis as always Dan. Thank you for sharing your professional insights with us. I've bern lurking on and off here since this blog first started and always found it refreshingly candid and unbiased.

    As you mentioned, it looks like gold will get the bump you mentioned once the Russian armored vehicles start roaring into E. Ukraine within 2 weeks in my estimation.
    Putin wants Kiev and the Odessa region in my opinion.
    Estonia would be a bold move but there's no telling where his mind or heart is at these days. There's little doubt in my mind that Putin found out some important intelligence revelations from Snowden regarding US intentions towards Russia or the scope of current spying and interference within the Russian sphere right up to it's border.
    Ukraine clearly qualifies under that category so look for Putin to continue his pre-emptive ways in establishing a newer and thicker buffer zone between Russia and NATO.

    Gold gets another volatiliy play soon because of it imho. For how long remains to be seen as it depends on Putin's state of mind and how much Snowden knew or revealed to him.

    Much has changed since Snowden bolted the US for China and then Russia. I think we're seeing some of the fallout right now.

    ReplyDelete
    Replies
    1. DarkPurpleHaze;

      Thanks for the nice comments;
      I think you make a very good point. I also feel that Putin has been pushed into a corner by the constant interference of the West in his own backyard.

      I think we in the US would feel the same way if it was a foreign power that was stirring up strife here in our own hemisphere and in our own backyard. Ukraine has no strategic significance to the US but it is key to Russia's warm water port there on the Black Sea.

      When the Russian leader sees some here in the US pushing NATO inclusion for some of the former satellites of the USSR, they have good reason to be concerned.

      Here in the US we hear constant chatter from the leaders about "democracy" and the right of self-determination and yet whenever a vote goes the other way than what the US leaders want, we start with our attempts to undermine it.

      It is none of our business in my view. Besides, we have more than enough problems here in the US...

      ALso, your points about Snowden are very well taken!

      Delete
    2. You're welcome.
      I just lost two posts trying to expand on what I think is going on regarding Russia.
      I'll try to gather my thoughts up again on this some other time.

      Russia vs. NATO is just getting started and the Snowden situation has changed the trajectory of history and accelerated situations that were quietly percolating to just below the boiling point.

      And oil is up again and talking loudly despite the US's Strategic Petroleum Reserve release slap-on-the-wrist retaliation two weeks ago. 40,000+ massed Russian troops and armor are about to soon take a large bite out of the Ukraine and essentially make it landlocked.

      Snowden is the swan responsible for the deepening ripples across the pond.

      Delete
    3. 1) I don't think that Snowden has anything to do with what's happening in Ukraine.

      2) It's interesting to see how Putin is perceived as the great invader with ambitions of conquest similar to Alexander the Great, when he's been playing low key since the beginning of this crisis, invaded noone, shot noone, sent troops nowhere (there is an agreement with Crimea about 25.000 russian soldiers deployed there, there was no invasion, and reminded in his last speech he has no intention to invade anyone anywhere).

      I think the West is bluntly portraying Putin as a threatening ambitious new dictator, hungry of conquests and to restore militarily the old soviet union.
      I may tell you that he is probably more subtle than that.
      He is trying to show that he is following the rules of international law.
      He is trying to rally the BRICS on his banner, not to be isolated, and on the contrary, to portray US / EU as the bad guys.
      Invading Ukraine as you describe will completely negate this strategy and its advantages.
      This would be a fool's move, and I don't think those guys are fools.

      Delete
    4. P.S : should Putin plan to "conquer" Ukraine, he will wait for a real reason to do this. Imho, the minimal conditions he will be seeking are :

      - Ukrainian people welcoming Russia as a liberator and turning its back to NATO / Europe. To achieve this, waiting may be by far the best strategy, as IMF is already busy plundering the country just as it did to Greece, Spain,... with the huge successes we know, especially towards the population.

      - Ukrainian civilians disarmed. Great : the government in Kiev is asking for it. Let them do the job first.

      - Ukraine joining officially NATO (this is not a given) or US/EU opening military bases / missile + ABM bases in easter Ukraine.

      - Violent riots and civil unrest in the eastern provinces, with threats on the russian population living there. Unlikely as oligarchs and their civil militia took control and restored some kind of order.

      None of those conditions happened or are likely to happen within 2 weeks.
      I think Putin is rather reminding the West that :
      - Russia is not a minor regional power
      - Russia will not be intimidated
      - Russia will call the West's hand and the West's bluff, whether it is economic sanctions or military escalation
      - Russia has the power to invade Ukraine in a blink.
      - Russia has the power to transform US in a land of ashes.

      I don't think there is a threat here.
      Hitler never told Staline he would invade Russia.
      Staline never told Poland he would betray them and invade them with the Nazis.
      Israël never warned Irak about Osirak.
      Surprise is a great element in victory.
      Threats, military demonstrations of power as I see them from Russia are a reminder that the West should stop escalating. It is not a provocation. It is not an escalation. It is the contrary imho.

      It is a simple way to say : don't bet more here, just fold your hand and let's find a way out, because if you bet, I'm going to call or reraise you badly.
      Conclusion : the ball is on our side. Next move from Russia will come after the West's move. Russia is waiting.

      Delete
    5. It will occur slowly with bad actors funded by Putin. You know, vote in each district for which God to succumb to. Get out some brown shirts, stir people up, then protect Russian ethnicity. Long drawn out process, or bang. Eventually it will probably split like the middle east countries. Russia will be there to play "mother protector". Should have sold with rumor.

      Delete
  14. was the headline Gold sinks....or gold stinks. Just a little humor.

    ReplyDelete
  15. The gold market has several layers of fraud in it. All of which have been played pretty hard already. The GLD has to be about bone dry. I am surprised they could take 700tons out of it, the allocated accounts have been raided, we have stolen the Gold from Egypt, Libya, and now the Ukraine, All the Fed gold has been leased, and the paper market have been pumped like a two dollar hooker. At some point the physical market will trump the paper criminals.

    ReplyDelete
    Replies
    1. Slipstitchpass;

      That may or may not be true but quite honestly, and no personal affront meant to you, we have heard this same story for years now. Your phrase " AT SOME POINT" might one day be true - but in the meanwhile as one waits for the "AT SOME POINT" to get here, gold has been a lousy investment for the past two years.

      If the Dollar sinks, gold will move higher. If the Dollar rises, gold will struggle and more than likely move lower.

      Instead of sitting around waiting for the "AT SOME POINT" to arrive, why not actually learn to read the markets and make your investment choices accordingly? You would have more chances of actually prospering that sitting around waiting for something that might never occur.

      Just a bit of friendly advice.

      Delete
    2. All of the major currencies are being printed so the dollar can be diluted and still rise against other currencies. I saw a chart of Chinese bank assets today...you should give that a good look. Gold is the great re-balancer of debt and debt based currency. God made it to be that way. As far as the paper price goes...like I stated there are several layers of fraud that can and will be exploited. The derivative market it another layer of fraud and is being used as the control grid for a lot of markets including the USTreasury market. Then you have Belgium stepping up to the number 3 spot for US treasury ownership. Something rotten in Denmark I suppose.....

      Delete
    3. I didn't know that Jesus was involved in the business of debt rebalancing and debt based currency, but I'm learning a bit more everyday...
      But I agree that the game is deep and complex, and that gold, as the anti-dollar, if of strategic importance to some powerful forces, probably acting from the shadows at some point, and directly or indirectly trying to suppress the possibility of rising prices. Gold shouldn't be seen as a safe, regular source of profit, especially vs dollar.
      To achieve that goal, several means :
      - increase price volatility.
      - amplify the drops of prices at key levels.
      - cap gold prices on their way up when they are in a bullish phase.

      In the end of the day, I think that the rise of gold prices will not come from a victory of gold bugs buying over those forces, but by the very collapse of the USdollar itself.
      Rising gold prices will merely be a consequence, not the cause, of the loss of confidence in the fiat currency, of currency debasement, etc...

      Delete
  16. Dan
    Thanks for you commentary and the effort you put in to keep up informed. Like you, I've grown weary of the rabid screaming about conspiracies and BB and CB hobgoblins acting to suppress gold, for no apparent valid reason other than they hate gold. I've been reading your site and a few others trying to get facts and real information about market actions. Thanks for being one of the credible sources.

    A question arises from recent articles concerning Chinese buying physical and selling offsetting paper. Does this seem likely to you? There seems to be some element of truth to it. Reports indicate that they are taking off a great deal of physical gold. Then there are the sudden bursts of selling on the Comex and elsewhere from traders who seem unconcerned about the effects of dumping large quantities of gold on the market at once. One wonders?...

    ReplyDelete
    Replies
    1. Roger Dugas;

      Thanks for the comments. Yes, the "Gold is always manipulated all the time" crowd ( GIAMATT) have become a cult. There is no reaching them.

      Regarding China - they are buying lots of gold - that helps put a floor under the gold market. Asian buying has done this for many years now. They come in and buy when price drops but back away when Western oriented specs push it too hard too fast to the upside.

      No, I do not believe that any selling in the Comex is Chinese in origin. It is hedge funds.

      Those who keep pushing that theory simply do not watch any other markets besides their yellow metal god. Soybeans, Cattle, Hogs, Coffee, etc... all see the same sort of big moves due to computer generated selling and buying.

      Delete
  17. My primary comment earlier that I couldn't post was about the Russia/China alliance and how a weakened and contained Russia is not helpful to China's short term ambitions but exactly what they want long term...a weak Russia.

    It's a nice coincidence that I just saw this at The Telegraph...

    China Doesn't Back Russia's Invasion Of Crimea — And That's A Big Problem For Putin
    Ambrose Evans-Pritchard, The Telegraph
    Mar. 27, 2014, 7:46 AM

    Russia's Vladimir Putin has committed a grave strategic blunder by tearing up the international rule book without a green light from China. Any hope of recruiting Beijing as an ally to blunt Western sanctions looks doomed, and with it the Kremlin's chances of a painless victory, or any worthwhile victory at all.
    Mr Putin was careful to thank China's Politburo for its alleged support in his victory speech on Crimea. Foreign minister Sergei Lavrov has been claiming with his usual elasticity that “Russia and China have coinciding views on the situation in Ukraine.”
    This is of course a desperate lie. China did not stand behind Russia in the UN Security Council vote on Crimea, as it had over Syria. It pointedly abstained. Its foreign ministry stated that “China always sticks to the principle of non-interference in any country’s internal affairs and respects the independence, sovereignty, and territorial integrity of Ukraine.”
    We don't know exactly what China's Xi Jinping told President Barack Obama at The Hague this week it clearly had nothing in common with the deranged assertions of the Kremlin. The US deputy national security adviser Ben Rhodes appeared delighted by the talks, claiming afterwards that Russia could no longer count on backing from its "traditional ally".
    If so, Mr Putin is snookered. He cannot hope to escape financial suffocation by US regulatory muscle, should he send troops into Eastern Ukraine or even if he tries to stir up chaos in the Russian-speaking Donbass by means of agents provocateurs.
    Nor can he hope to turn the tables on the West by joining forces with China to create a Eurasian bloc, a league of authoritarian powers in control of vast resources. Such an outcome is the obsession of the 'Spenglerites', the West's self-haters convinced that the US is finished and that dollar will soon be displaced by the Eurasian Gold Ducat -- odd though that may seem at a time of surging oil and gas output in the US, and an American manufacturing revival.
    The reality is that China is breaking Russia's control over the gas basins of Central Asia systematically and ruthlessly. Turkmenistan's gas used to flow North, hostage to prices set by Gazprom. It now flows East. President Xi went in person last September to open the new 1,800 km pipeline to China from the Galkynysh field, the world's second largest with 26 trillion cubic meters.
    It will ultimately supply 65 BCM, equal to half Gazprom's exports to Europe. Much the same is going on in Kazakhstan, where Chinese companies have taken over much of the energy industry. The politics are poignantly exposed in Wikileaks cables from Central Asia. A British diplomat is cited in a 2010 dispatch describing the "Chinese commercial colonization" of the region, saying Russia was "painfully" watching its energy domination in Central Asia slip away.
    Yet more revealing is a cable quoting Cheng Guoping, China's ambassador to Kazakhstan, warning that Russia and China are on a collision course, and China will not be the one to yield. "In the future, great power relations in Central Asia will be complicated, delicate. The new oil and gas pipelines are breaking Russia's monopoly in energy exports."
    Mr Cheng not only expressed "a positive view of the US role in the region" but also suggested that NATO should take part as a guest at talks on the Shanghai Cooperation group -- allegedly the Sino-Russian answer to EU/NATO -- in order to "break the Russian monopoly in the region.".....

    ReplyDelete
    Replies
    1. The rest of the story....

      http://www.businessinsider.com/lack-of-chinese-support-for-crimea-is-a-big-problem-for-putin-2014-3

      Delete
    2. Russia and China are regional rivals in some ways indeed.
      But...
      The enemy of my enemy is my friend.
      If the US are threatening strategic interests of both China and Russia (Chinese Southern sea, Ukraine...), then it offers them a common enemy, and that may be more important than local disputes over resources and energy.
      Future will tell.
      If US are clever and want to weaken Russia first, they will probably loosen the grip over China and be more friendly and flexible with them for a while...the game is to isolate Russia from any potential allies, especially from the rest of the BRICS.

      Delete
  18. Meh....

    Russia, Syria, Fukishima, Greece, Iraq, Iran, etc.

    None of it has mattered to equity markets or gold.

    The fact is, stocks remain in a super bull market heading towards its 6th year, U.S. Treasury bonds still in a 30+ year bull market with no end in sight, and gold is now in a bear market approaching the 3rd year.

    None of these geopolitical events have had any impact on the booming U.S. economy and the unquenchable thirst for paper IOU's and common stocks.

    Zero.
    Nada.
    Zip.

    ReplyDelete
  19. Dan , I think you are completely right about the fact certainly the fact that HUI has fallen below the ma , but i think you are being a little biased in your reasoning . In my humble opinion it took a very long time for the ma to cross and HUI to come above , the fact that it fell in a couple of days right bellow , doesnt add much for the already bearish argument , it needs to be confirmed . In any case the momentum is horrible and you may be right . Only time will tell though .

    ReplyDelete
    Replies
    1. Anon;

      Thanks for the comments but there is nothing biased about the reading... I am giving you a view as a technician. The ADX is moving lower (uptrend is over); the -DMI is above the +DMI ( the bears are in control) and the price is below both major moving averages.

      Those are all bearish. Gold has dropped $100 off its recent peak. HOw much more does it need to drop to be bearish for you?

      The bulls have one last line of defense near the $1287 region which in reality extends down towards $1280. If it holds here, fine... but that does not mean it is going to turn around and resume some sort of strong uptrend right away. It could just meander in a range.

      We have the end of the month and the end of the quarter coming up and we have a Friday. Gold has collapsed since the 17th and some bears might decide to ring the register and take those profits. If they do, support will hold. If they do not, support will not hold.

      Time will indeed tell my friend.

      Delete
  20. Hello,
    Following the advanced signal, which is becoming more and more valid by the day. Unfortunately, not much to play here imho, as prices are always too far above the bol inf, under resistances such as ema15, ma20, and an upper bollinger heading down fast and already not far away.
    As you can see, the inf bol is reversing up on time, a few candles after the ET MACD reversed down from new highs. I'm using this signal only when the standard bollinger 20 period is beyond the bollinger 100 period, i.e the bollinger band of the slower time unit.
    Good trades to all,

    Oh, I found a great quote from one of your presidents yesterday.
    Pity many of your great men only end up assassinated.
    That's a quote we could send to those who absolutely try to convince us that gold can only go up all the time, and the world is about to end, when those same people have a vested interest that you buy gold / silver (even more silver), as they have a company which by chance happens to provide exactly that kind of services...for the records to newcomers to the PM world, some of those people have said the same thing over and over for years, they never changed the speech, they count on newcomers and red fish memory brain structures to make them rich.

    "Better to keep one's mouth shut and be thought to be stupid than to open it and remove all doubt" - Abraham Lincoln

    ReplyDelete
    Replies
    1. sorry, forgot the chart, daily time unit, Copper.

      http://i62.tinypic.com/2wofyvs.jpg

      Delete
    2. Ha! Hell of a quote, so true

      Delete
  21. Long term gold.

    Quarterly time unit : still weak. Can't break through 1415 area, which is a minimum to reverse the bear trend. Still, 1200 is a clear support which is holding, for now...

    Monthly time unit : oops! Closing at 1300 is really not so good for bulls. Because it even closes under the green fork, i.e it seems to confirm this is only a pullback in a bear trend and the resistance of the green fork is valid. Still, we broke through (but because of exceptional situation of Ukraine?!), so I'm inclined to be neutral as long as 50% or 62% Fibo of last move up hold (which means 1265 last limit).

    http://i57.tinypic.com/2vi49i9.jpg

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  22. Great thread as always Dan.

    I'm with you. The Manipulation Whiners are indeed a cult. A cult of losers, and you are right that they are beyond help. But hopefully voices of reason like yours will perhaps steer a newcomer here or there to avoid the abyss.

    Trade the markets we have! Not the markets that only exist in some feverish, dogma ridden fantasy land.

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  23. I keep things simple. A weekly close beneath the 200 day will put gold back into sell mode. Period.

    No geopolitical or economic analysis required. And indeed, you are better off if you don't.

    ReplyDelete
    Replies
    1. good thoughts Eric; always remember that most specs deep down want to lose and then bellyache; sparks

      Delete
  24. Dan....looks like your refreshing style of thought is being paid attention to...
    http://www.tfmetalsreport.com/comment/394656#comment-394656

    And hello to Eric O above me. I have no regrets with my gold or silver
    purchases because it's a long term thing. I do regret allowing myself to get sucked into some group think regarding trust isdue's involving the equity markets to the point I ignored them.

    Back in 2009 when the markets really dipped I made a wish list of stocks I thought would excel from the bottoms they were at but I didn't dare given the QE conditions back then I didn't fully understand.

    I screwed up and that's on me but I did learn a valuable lesson along the way. Live and learn.

    ReplyDelete
  25. The basis f the pyramid, or how to recruit the fish lemmings for the slaughter.
    lol. I love the fake comments at the end of the page, too.

    http://www.markettraders.com/forex-article/how-to-grow-a-small-investment/indexadwordstr.php?utm_source=AdwordsTr&utm_medium=dis&utm_term=Forex_Trick&utm_content=Forex_728x90_v4_4&utm_campaign=DIS_Adwords_US-EN

    ReplyDelete
  26. And a hearty good morning to my old pal DPH.

    Yes, we've all learned a lot these past few years, and paid our tuition via market losses (the usual way, though the cost varies from person to person). I'm no exception.

    The point is, we learned as we went, and changed the way we approach some things. Certain websites (like the one you referenced above) are run by, and overrun with, people who seem incapable of such a thing.

    The ability to change one's mind is an essential survival skill.

    ReplyDelete
  27. Yep... I agree with that EO. Nice to see you also, it's been awhile.
    I've been laying low and enjoying life while still keeping abreast of the markets and geopolitics.

    It was time to move on and in truth it was something I resisted for almost 2 years. It wasn't personal at all but it was liberating on some level I didn't fully realize until I did so. I left behind many fine folks who I came to know but at some point it became unbalanced in a negative way that impeded my desire to contribute to that cause after I finally accepted it strayed too far to the extreme side imho. That's not a blaming statement and more of an indication I felt constricted to freely think in an atmosphere that at times was like a dense negative smog.

    I think it's important to allow one's self to entertain trains of thought they're not comfortable or familiar with in order to maintain a balanced perspective instead of a "all or nothing" outlook that purposely excludes objectivity because it doesn't fit their belief system or objective.

    Personal growth (as well as financial) demands outside of the box thinking otherwise a person (or people) will stagnate. I left that site (without personal bitterness but with some disappointment) because I felt it continued to relentlessly march down an alley of sentiment that kept bumping into a brick wall and the wall itself was at fault instead of the tunnel vision that guided some into a dead ended alley of thought or beliefs.

    News flash....it's ok to turn around and walk out of the alley and continue down the other avenue's of thought out there even if the alley was fun to hang out st one time.

    Blaming the dead end wall of manipulation for everything is not an investment strategy. It's the mindset of a cyclops outlook who lacks or isn't comfortable with a wider periphreal vision that doesn't fit their tightly scripted outlook or business model.
    It is what it is until it isn't.
    Good day all....life beckons and the sun is shining today...for now. :-)




    ReplyDelete
    Replies
    1. DPH-

      "Blaming the dead end wall of manipulation for everything is not an investment strategy. It's the mindset of a cyclops outlook who lacks or isn't comfortable with a wider periphreal vision that doesn't fit their tightly scripted outlook or business model."

      Sounds like you're describing the brain of an insurance salesman. ;-)

      Delete
  28. Oh no! TF's cool aid drinkers are coming to invade this site too. Instead of the cool-headed analysts we'll get all kinds of cuckoo guys with tinfoil antennas. I've got to run again and hide somewhere else. There must be one place left in the world...

    ReplyDelete
    Replies
    1. Abraxas;

      I am glad to see some of these guys slowly coming around to understanding that they have been unwittingly pulled into a school of thought that precludes them from an honest interpretation of what is occurring in the markets.

      This is one of the reasons that I post at this site... let's wake as many of them up as we can and welcome them to the real world.

      Coming out of a cult is never easy.

      Delete
  29. I didn't mean to be fastidious. I apologize if I have offended anyone. Many of these "gold friendly" sites are actually very hostile and hurtful for the very gold community they claim they are trying to help.

    ReplyDelete
    Replies
    1. Abraxas...no problem. I understand the raw nerve aspect of it.
      We're cool. (insert AC/DC "Have A Drink On Me") ;-)

      Delete
  30. This comment has been removed by the author.

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  31. Poor Richard Russell.

    Dow is strong as an ox, yet he's buying silver?

    Oh well, he can do whatever he wants. He's independently wealthy, and can buy silver if he wants.

    However, for those attempting to build wealth for new home purchase, kid's education, retirement, etc. recommending the weakest asset is hands down the worst advice ever.

    I'm wondering if "The Godfather" will even live to see another real bear market in stocks, or a bull market in gold again.

    ReplyDelete
    Replies
    1. He'll live long enough to collect the money from the subscriptions.

      Delete
  32. Mark, let's see, if the citizenry will not buy JGB's, and the Chinese, Russians, Europeans, and your FED will not either, then who will do the buying? Right, the BOJ will be the last man standing and not for long, as Abe will get what he wishes for (and in the end will regret) and that is 2% inflation. That is game, set, match. He has gone all in and it will end in tears, as the Yen collapses to 250, marking the greatest collapse in a developed world's currency in history. Is that a fat lady I hear singing? sparks

    ReplyDelete
    Replies
    1. At some point all govt's will self monetize all or most of their own debt and it'll be considered normal because of it's necessity for all of them to do so.

      Long term low ZIRP rates are the mechanism by which some govts. will somewhat get out from under their growing debt obligations the longer they keep rates low. The fact they're buying or absorbing so much of their own bond auction issuance means at some point when those bonds mature they'll essentially be paying interest back to themselves in the future upon the maturity of all that paper they issued and still currently issuing.

      QE monetization of their own treasury bonds and sterilization of toxic securities out of the system might just work the longer they engage in it.
      In the end the ugly part of the Fed's balance sheet will be written off just like any other ledger debit some huge private corporation might do so. If most or every country that engages in some form of monetization of their debt has an eventual need to sterilize their debt (by writing it off) all the other countries engaged in the same scheme won't say a word eventhough they might publicly chide other countries while they do the same exact thing.

      China is no different then the U.S. in this regard. China is in no position to call out the US or any other CB about monetary policy and monetization and stimulus etc.
      They might just he the biggest culprit of it and in the end all CB's will benefit from such a scheme. The citizens of those countries...maybe not so much.
      I'm not advocating the above but it's something I think that'll happen given the fact that TPTB in Govt make the financial rules up as they go along that's in their best interests.
      Monetizing and sterilizing a countries debt makes sense especially so when it's necessary and they mandate that it happen by law.

      And none of us will have a choice, as usual.

      Delete
  33. here comes the next leg if kwn is a reliable fading barometer like I have always said; they are so desperate for content that they are repeating an earlier story about some guy that made a correct silver call YEARS ago. Oh really? What does that mean? Oh, nothing? Right. This is another example of why there are more slot machines than crap tables in casinos; have a nice weekend everyone, sparks

    ReplyDelete
    Replies
    1. Let's leave them alone.
      Why should we mention kwn so often anyway?
      Let them think and write what they want.
      But for PM prices, if Copper didn't get through support at 2.90, it will probably reverse back up (already started actually) and head towards 3.20, which may support silver prices.
      I'm neutral, not bear nor long either regarding gold & silver at those prices.
      Could go any direction.

      Delete
    2. Hubert, we always have to watch and listen to what the other folks are saying; to ignore your enemies is suicidal; they may become winners one day and if you do not notice the trend change you are doomed; I agree on copper, last week was it at 293 for now, but any rally to 310 I would think is a fade. Finally, as long as kwn is alive and willing to post, I am ready, willing and able to chastise, criticize and laugh at them because that is what is what it is all about, no? take care and enjoy your family and weekend; sparks

      Delete
    3. For me bo polny does the job. When he gets posted i dont fade, i run.

      To not be very very critical about these practises is too amoral and cynical for me taste.

      If the only way one can succeed is by destroying others one deserves to be put in the light of day.

      Nomineyet.

      Delete
  34. This relates to the Business Insider/Telegraph article I posted last night.
    The Chinese support of Russia seems tepid at best.
    Consider this....would China rather deal with Ukraine or Russia when it comes to procuring food or natural resources from Ukranian territory?
    China's self interest will never change, nor will Russia's. But if I'm China I'm hedging my bets and thinking that the new Ukranian will be easier to deal with then a Russia dominated Ukraine.

    UPDATE 1-China takes no sides on Ukraine crisis, Xi tells Europe

    Fri Mar 28, 2014 1:51pm EDT
    SHARE THIS ARTICLE
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    * President Xi says Beijing has no private interests in Ukraine

    * China also ready to give financial aid to Ukraine

    * Visit results in several business deals for Germany (Adds details, quotes on World War two)

    By Stephen Brown and Annika Breidthardt

    BERLIN, March 28 (Reuters) - President Xi Jinping said on Friday China would not take sides with the West or Russia over Ukraine, disappointing any hopes Beijing might add its weight to international pressure on Moscow for annexing Crimea.

    "China does not have any private interests in the Ukraine question," Xi told a news conference with German Chancellor Angela Merkel. "All parties involved should work for a political and diplomatic solution to the conflict."

    China has adopted a cautious response to the Ukraine crisis, not wanting to alienate its ally Russia or make comment directly on a referendum in which Crimea voted to join Russia, lest it set a precedent for restive regions of its own such as Tibet.

    In an U.N. Security Council vote earlier this month on a draft resolution to condemn the Moscow-backed referendum in Crimea, China's abstention effectively isolated Russia.

    "If I were Russia, I would not be satisfied with the number of votes in favour of Russia," said Merkel, who despite her country's close trade ties with Moscow and heavy reliance on Russia gas exports has backed European Union and U.S. sanctions.

    The chancellor, who has tried to use her influence on Russia President Vladimir Putin to de-escalate the crisis, called the U.N. vote a clear sign "that the international community is not very happy with what Russia has done".

    China has signaled understanding for Russia's position, saying what is happening "has historical reasons". Chinese state media has also expressed sympathy for Moscow.

    DELICATE DIPLOMACY

    But China has also said it wants to develop "friendly cooperation" with Ukraine. Its foreign ministry said this week Beijing would play a "constructive role" on international financial aid for Ukraine, though it stopped short of saying whether Beijing would participate directly.

    "We support the constructive efforts the international community has made to de-escalate the situation and are open to any concepts which serve to calm the situation and to bring about a political solution," Xi said in Berlin.

    "The Chinese side always respects the principles of...." (cont.)

    reuters.com

    ReplyDelete
  35. I am always surprised at some of the emotional and incorrect opinions expressed here and everywhere else. Point being that the NY bankers bankrolled the Bolsheviks > WW1 and the fledgling Nazi movement, AND continued doing so all the way through WW11; check out how many American backed factories were not touched in Germany in the greatest bombing operation of all time; ever heard of ibm, Mercedes, ge, siemens and on and on? Hitler got his ideas from California when it came to eugenics and so forth, and to conclude, how many innocent German civilians were enslaved or murdered by Uncle Joe > WW11 for the next 7 years until he thankfully died, by the Poles, Ukrainians, Italians, French, Bulgarians, and most of all, by his own people? The worst man the world ever has seen; sparks

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  36. Rumsfeld+bush+obama+kerry+mccain= the biggest acidic, toxic of American leadership of all time and that is all folks; sparks

    ReplyDelete
  37. Well, the sector that KWN said was the one that was going to crater did the best this week: Emerging Markets. With Latin America up a shocking 9 consecutive trading days.

    And of course, hands down the worst sector of the week: Gold, which even underperformed many of the mo-mo sectors that got hit this week.

    ReplyDelete
  38. GOLD.
    So...which time unit to choose?
    I'm not watching so much the daily time unit now, because fibo retracements are too close from each other to have a real significance imho.

    I find the weekly time scale more interesting : 2 ugly (for bulls) red candles show that the ball has been on the side of bears. I don't see a mere daily time unit fibo stopping that.
    But I would give a chance to the mlh inf of the upwards pitchfork, in the 1275 $ area. It also corresponds to a horizontal area of support / resistance.
    AND to the ma20 on this time scale.
    So I prefer to give a chance to supports on that time scale rather than on the daily one.

    But since Gold has more or less been rangebound, let's have a look at the Stochastic.
    Bingo.
    See how Stochastic is in sync with tops and lows?
    I mean, I usually prefer watching MACD when market is in a trend, and Stochastic or RSI when it's rather rangebound.
    So...Stochastic for now has just started its new move downwards, which may mean more downwards pressure.

    Given all this, I'll probably give a chance to the 1275 area to hold, but watch closely the daily time unit next week to get in / get out quickly if need be.

    I hope Dan is able to read my mess sometime and will correct me if he thinks I'm making a big blunder in my TA :)

    http://i62.tinypic.com/293did5.jpg

    Have a nice weekend to all, and you too Steve, from Sparks, what else? :)

    ReplyDelete
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    1. P.S : as an aside, the red fork gives a target of 1240 next week, 1230 in 2 weeks.
      Given the slope of the daily bollinger bands, and given the fact that 1230 corresponds to the 77% fibo retracement of 1180-1390, if prices fail to find support on the 1275 area above, well...I think they might collapse down all the way to 1230 within 2 small weeks.
      As usual, big IF here, as for now we are still alive and kicking at 1300 $ :)

      Delete

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