“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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Saturday, March 8, 2014

GLD Holdings Higher

Most of you who are regular readers of this site are aware of my view that Western investment demand for gold can be gauged by tracking the reported holdings in the big gold ETF, GLD. While physical demand out of Asia is critical to the well-being of the gold market, I have maintained that without a correspondingly STRONG Western-based demand, gold cannot mount a sustained rally. Asia buying has bottomed or put a floor under the gold market for many years now but it is Western origin speculative demand that has driven gold strongly higher in the past.

That being said, as of the close of trading Friday, reported gold holdings in GLD are at 805.2 tons. While this is up 1.5 tons from the last numbers (which were steady for the previous 8 trading days) it is still down from this year's peak of 806.25 back on February 13. Interestingly enough, the price of gold at the Comex closed at $1300 on that date. From that point on, it has ground higher before hitting a wall near the $1350 level. Yet the tonnage is lower.

What to make of this?

My view is that gold's recent rally has been driven PRIMARILY by short covering ( note - I am not using the word, 'solely' ).

Here is a chart drawn from this week's Commitment of Traders report:




Let's start at the date of maximum hedge fund outright short positions. That occurred the week containing December 3, 2013 where the total number of outright short positions, including futures and options registered at 79,631. As of this Tuesday, that position has been drastically drawn down to where it now stands at 26,321, a reduction of 53,310. On that date, gold closed at $1220.80.

Now let's look at the hedge fund outright long positions. The lowest number of those occurred during the week containing Christmas Eve at 104,754. Since that time, this category has now grown to 144,562 as of this past Tuesday, an increase of 39,808.

Can you see what is taking place? Short covering continues to outnumber the fresh new buying in this market. Until I see some evidence of this changing, I cannot be too optimistic for the possibility of an EXTENDED move higher in gold.

What seems to be happening with the metal right now is that certain events, more specifically, two previous payrolls reports and a geopolitical event, namely, the outbreak of tensions and strife in Ukraine, have spooked the bears into covering shorts.

Until yesterday, Friday, the last two payrolls report, came in much weaker than expected by the market. Those reports immediately fanned the idea that the planned tapering activity by the Fed was going to be put on hold, especially with the dovish Yellen now at the helm. With that came the idea that Fed was also not going to raise short term interest rates any time soon. The result was FALLING longer term interest rates and a corresponding weakness in the US Dollar. With that, money came into gold while shorts covered but it was mainly nervous shorts wanting no part of getting steamrolled by the onset of a new "buy tangibles" wave in anticipation of Dollar weakness.

Throw on top of that the fact that fears of escalation in the Ukranian situation caused a panic run into the metal and once again the bears were given no reason to get aggressive in selling. Quite the contrary, they opted to head for the hills first and ask questions later. What they are now doing is watching to see how events are going to unfold over in that volatile region.

The big mover on Friday (yesterday ) however was not Ukraine, but rather the payrolls report. While not exactly a overwhelming display of healthy job growth, it was better than the previous two reports. Also aiding the report was an upward revision in the prior months of 25,000.

But here is an interesting item in that payrolls report - the number of "not at work" due to "bad weather" was 626,000 compared to 253,000 in February 2013 and 200,00 in February 2012. ( Data courtesy of Dow Jones ).

That shifted the psychology in the market to one of " we told you the poor job numbers were due in large part to the record cold and frigid weather conditions experienced over at least half of the continental United States". In other words, traders are coming around to the view that while the payrolls numbers are certainly not exactly setting any records, they were also not as bad as some were fearing  and that the recent poor showings were weather-related and thus NOT THE START of a new trend.

Now, it remains to be seen what we are going to get in subsequent payrolls reports but it will be very important to closely monitor those reports as the more seasonal weather slowly sets in. If the numbers DO NOT show strong improvement, then traders will re-evaluate their new attitude as of this Friday and shift back to ideas that the tapering plans of the Fed are going to be on hold. If the numbers do show steady, albeit very slow upward growth, then expect the Dollar to garner some support ( it is also sitting right near some very strong chart support ) and US interest rates ( longer term ) to stay firm and creep higher. Remember the Fed has emphatically stated that it is going to be "DATA DEPENDENT" ( their words, not mine ) when it comes to their approach to tapering and to short term interest rates.

This will tend to work against gold, especially if the US equity markets continue to soar to new heights. Now they are talking 1900 in the S&P!

Where this leaves us is simple - from a technical chart perspective, the near term technicals have improved in gold. This is keeping fund computers buying dips and preventing that category from getting aggressive on the short side. As long as any important downside support levels hold firm, gold should remain in a sideways type of pattern as the geopolitical uncertainties with Ukraine prevent bears from getting aggressive. Any sign that events over there are settling down and this market is vulnerable to a wave of long liquidation. On the other hand, if for any reason things flare up further, then gold will see further short covering that might be strong enough to take it up through the cap near the $1,350 region. It would have to clear $1,365 or so to have at least a chance of reaching the psychologically important $1400 level.

Incidentally, before closing this post, I want to note once again the chart of copper.


This chart continues to amaze me to no end - with equities soaring into record territory seemingly every week, copper is sending the exact opposite signal in regards to the health of the overall global economy.

Note the Directional Movement indicator show the bears in solid control of this market. Also, the ADX line is beginning to rise as the price descends indicating the increasing possibility of a trending move LOWER. Note - for that to occur copper would have to close below the $3.00 level in my opinion however. For now, it is in a sideways to lower pattern.

The COT report for copper is also very revealing as it shows a continued build in SHORT positions by the large hedge funds. In addition to that however, what I find EXTREMELY fascinating is the positioning of the other players in the copper market.

The big commercial category consisting of the Producer/Merchant/Processor/End User category is also a LARGE NET SHORT by more than 2:1! The Other Reportables category is also NET SHORT by 2:1 and the small trader, the general public is net short by nearly 6,000 contracts. The entirety of the long side interest in the copper market is being held by only one category of traders and that is the Swap Dealers, some of those no doubt being index funds which are oftentimes lumped into that category for reporting purposes. This is not something which one sees very often. But regardless, the fact that a combination of both commercials and speculators are short copper is astonishing given what is going on in the equity markets. It could be some are looking at credit issues surfacing in China and are bearish as a result.

I said all that to say this - it makes me suspect this commodity sector rally we have been seeing. Some of the individual commodity markets do have strongly bullish supply/demand scenarios and thus their price rise is justifiable but if any of this buying is based on "hyperinflation" fears as some are suggesting, they are way off base because Copper would be leading that charge higher, not attracting the kind of determined selling that it has been getting of late.

Let's continue to watch this closely...




46 comments:

  1. So it appears that the pounding that silver took on friday is more related to the copper decline then to anything else. But would certainly appreciate if there is another take on that.

    ReplyDelete
  2. but … what about the stock market ?? do we have a recovery or do we not … I would have thought that the stock market would look at copper every once in a while , but it obviously is not doing so , yet , Dan you come and say , look out gold bugs , copper is falling off a cliff … what about the SM ?? could it be that frustrated shorts are shorting copper since they can not short the S&P any longer ?? Is the FED going to start buying copper so they can keep the dream alive ?? I mean you can not have it both ways …

    ReplyDelete
    Replies
    1. Anon;

      I am not sure what your point is. My point is that copper is signaling one thing while the equity markets are signaling another. I find that particularly strange and I tend to side with copper for I feel it has a better predictive record as to the health of the real economy than stocks, especially over the last few years which are running more on hedge funds chasing yield in a near zero interest rate environment.

      Maybe copper will reverse course and head higher. If it did, that would confirm the strength in the equities to me as having some sort of fundamental backing but for now, I am convinced that equities are being run by hot money chasing returns in perhaps the only investment class that is actually producing more than 4% annual returns.

      One way or the other, at some point although I will admit I have no idea as to when it will occur, these two key markets ( stocks and copper ) will converge in direction. Believe me, if I knew when, I would already own my own private island in the S. Pacific.

      Delete
    2. Sorry i didn't mean to say YOU can't have it both ways , but ONE can't have it both ways , I am perfectly aware you aren't in the business of forecasting … this goes for those who claim gold is over valued if you look at the price of copper , and everything that comes with it , inflation , growth , velocity etc … but then , the most overvalued asset of them all , the SM , its ok , no problem , you can invest here … . Its all bull shit , its all about whatever the FED implies its safe to invest here or there … until they loose control or they don't . The amount of faith though , and trust , all the investing community is giving a bunch of people is just unbelievable … there is no growth , non what so ever , given the draconian measures , period . But yet most institutional money, pension funds etc.. are invested because as always , they have to … . I wouldn't touch the stock market with a ten foot pole … Unless of course , I had been clever enough to get in there 4Q12 like Mark did , then I wouldn't give a damn , I would be underweight anyway . But here ? with the price of copper doing what is doing , irrelevant of why is doing it … no way , risk of this gains from the last 18 months … That would be my concern , not whether gold is overextended or not at these levels … I am with Kevin M , this is not the year to short gold , and I say this very carefully because I respect Nenner a lot , and they are saying we see a big sell off by the summer … Oh well … I like that though , even if comex isn't as short as it used to be , sentiment hasn't changed one bit , negative as it ever was … Everybody waiting for the sell off … let it come … I ll be waiting

      Delete
  3. Commercials have built larger short positions in recent weeks. Who will prevail, commercials or the large speculators?

    ReplyDelete
  4. What I have learned over the years trading is that sometimes the market just goes up for no other reason but seasonality and change in sentiment. The Gold market and connected brothers are in a different mood this year and as last year being negative this year should be a positive one for no other reason but a change in sentiment.

    I don't think anybody really has a 100% grasp on why Gold does what it does. However sometimes simplicity is as good as it gets in understanding Gold. Case in point was last year. Herd mentality on the short side all the while buying the S&P 500 was the trade of the year. It was plain as day. Anybody watching the S&P 500 would notice a complete inverse relationship. This year that trade is backfiring on those that are still tied to it. This year is different and I would expect it to remain that way. Wallstreeet or the speculative community and Dan refers to is the driving force and they have long/short portfolios. They also have trades that they deem worth holding onto and adding to during the duration of a given year. Gold is one such hold and add trade here in 2014. Expecting things to change this year in 2014 and reverse to the ways of last year is kinda short sided.

    One note that I'll put out there. Tapering will make GOLD go higher. Crazy thought right. However pay attention to the official date it started(Dec 2013) Since the onset of tapering Gold and it's sectors(even the CRB/CCI) have gone higher and has been sustained even in the face of fed talk and such. Could it be that the market perceives QE deflationary and tapering inflationary? Yeah I know.....conventional wisdom says I'm crazy but the market said something entirely different from 2012 until Dec 2013.

    BTW Platinum and palladium look spectacular. Palladium just broke out of a 1 year long symmetrical triangle. Platinum closed above it's weekly 50ma and now projects at least a move to 100 points higher. Do I have to mention the CRB/CCI? It's all around us. It's NOT short covering IMHO. No way. It's macro and a change in sentiment.

    Cheers

    Cheers

    ReplyDelete
    Replies
    1. Kevin,

      Mr Dan explained last week very well that QE failed to achive hyperinflation and thus Gold reversed downwards starting Sept 2011.

      But hyperinflation never occurs due to excess money. It occurs when a central bank fails to cure deflation. Its when huge amounts of QE fails to jumpstart the economy. This is the case now as can be seen by the collapse in money velocity (lending, borrowing).

      I think Fed is now worried about Loss Of Confidence and a super spike in velocity of money as everyone dumps their failed currency for tangible hard assets. But Tapering can hardly help as $4 Trillion oh dry tinder is still out there waiting for a match or bolt of lightning.

      Agriculture and Precious Commodities are on verge of breakout or have broken out already, and industrial commodities are being held back due to chinese new year holidays' weak data streak. But it will not last too long. Copper, Crude will soon takeoff.

      Delete
    2. Well stated and could be the case here. Velocity of money is certainly starting to show it's head imho.

      BTW hyperinflation is something I don't expect, just maybe a 1970's situation.

      Delete
  5. Thanks for the analysis today TD, appreciate it.
    I think we're headed more towards a deflationary period moreso then a hyperinglation scenario as the world is mired in a low growth environment for the foreseeable future. War would spark growth that arises from the ashes of the glowing embers that war ungortunately creates out of destruction.

    Regarding Ukraine....Putin isn't giving up Crimea no matter what. It's Russia's for awhile unless it's liberated by NATO. God help us all if it ever gets to that point.
    In the end I think the Ukraine is partitioned in a defacto manner when the dust settles. It will be portrayed by the MSM that Putin won and Obama lost but in the end if NATO comes away with a strategic footprint in W. Ukraine it'll be a major coup.
    The key in my opinion will be if the West can keep the Odessa area out of Russian control so that NATO has access to a coastal area in the Black Sea. The recent US embrace of Moldova shouldn't be overlooked at this point.

    Anon: I don't see TD trying to have it both ways in his analysis above. He's laying out some possibilities going forward and not engaging in some ass covering predictions where he can claim he was right either way.
    At least TD doesn't engage in blaming "...the forces of darkness or evil bankers..." for every failed or unanticipated scenario that doesn't go his way.

    Slow deflation is where we're headed while mired in a slow growth stagnation. War would accelerate the deflation as mutual trade would wane as a consequence.

    ReplyDelete
    Replies
    1. Poor ukrainian people...what chance do they have, torn in the middle of our own wars? Who cares about those guys? Real talks are once more about geostrategy, military bases, oil...and in the end a civil war such as Syria? How many dead this time? When will this end? Welcome to the 21st century...nothing has changed. Instead of helping this country putting things together, both sides are setting it into fire. I guess I'm more sensitive for countries I visited than those I never saw. I know ukrainians. I know russians. I know polish. Actually I speak both russian and polish, so many ukrainians think I'm trying to learn their language when I go there, lol. This is such a tragic waste. When will we ever learn?

      Delete
    2. Germany will not allow NATO to attack as Germany depends on Russia for 50% of its Energy needs.

      Any major sanctions on russia will entail Gas cutoff for europe.

      It seems Kerry forgot an old rule. Don't bet your testicles if u love them too much, coz if u loose they r cut.

      Its already game set match fr Putin. Kerry's muppet president of Ukraine may soon be hanged.

      Delete
    3. The minute Kerry resigns, will be a big blow to the dollar index which then will breakdown below 73!

      Afterall it will add to a long list of failed diplomacy. Syria, Egypt, Sudan, Venezuela, Iran, Japan-China, North Korea, Afghan, Iraq, Pakistan.

      Delete
    4. Germany is too worried about its 300 mt Gold which USA has indirectly refused to return! While it would take three 747 freighters to ship it overnight, USA is asking for germany to wait 8 years!

      It makes one wonder whether the gold at fort knox and at nyfed is real or gold plated tungsten?

      Delete
  6. Surely the overhang of Chinese copper collateral is the issue, no?

    ReplyDelete
    Replies
    1. S Roche; I do not know if $3 is support, but if $2.75 breaks, there is nobody home for a long ways. it was not that long ago that we traded $1.50 prices; be careful; sparks

      Delete
  7. Gold and silver are just market traded securities. The majority of that trade is done on margin. Until the futures market completely loses its status - the price will remain relatively stable.

    ReplyDelete
  8. nobody reads kwn anymore, but if you do , poor Egon is making 80 a critical number for the $Index; it is not ; sparks

    ReplyDelete
    Replies
    1. KWN is the site of the LEGENDARY ACCLAIMED guests and various other keynote speakers. Are they not accurate ANALysts?

      Delete
  9. Hi Trader Dan,

    This is not a comment for I cannot make a comment from your great posts for they are all informative and concise, I've been a reader of you for almost a year now since I discover your great blog from my research, and as an individual who is not capable to trade the market that much but continue to learn the market through my own way (hoping someday I can 'stumble' my capital), I guess if you have time and if you don't mind please, if you could post a column about your trading or something that can have an idea how to trade the market based from your experience will be gladly appreciate. I asked this because as an individual who cannot afford expensive classes can have something an idea from great trader like you please. Thank you.

    ReplyDelete
  10. Koos Jansen at ingoldwetrust.com currently has a very interesting article about how China has a significant amount of gold stored at the NY Fed.

    I'm of the opinion the US has their claws deep into their adversials weak spots more then anyone realizes. Just consider how or why the Chinese and others could get screwed out of their gold holdings and why they even GAVE their gold to the NY Fed in the first place.

    Most of these countries will probably NEVER get their gold back.
    Read the article and consider the potential scenario's that could play out if the US keeps everyone's gold.

    Sounds like a war against the USD is not in China's, Russia's or anyone else's best interest until they get their gold back.
    Good luck with that!

    ReplyDelete
    Replies
    1. Dan The Man
      You pose an interesting thought. Considering the likely side effects of such am action. It would result in total economic warfare and likely physical as well. There would certainly be no international trade with those whose gold we stole.

      Given the timidity of politicians and the certain blowback from every voter who could not get their toys and electronics at Walmart. It is very unlikely that they would do this outright to all depositors.

      More likely they would retaliate against one nation that had acted economically against the USA. The repercussions of even this would be severe when other nations realized they could be next. However, given the hubris and arrogance of the US government in general ant the current administration in particular it could happen. I hope they are not so stupid and I pray they don't become international gold thieves.

      Delete
    2. Mike, or that they don't intend to blow up everything in the first place (referring of the theory of neocons / globalists / joint chiefs whatever supposed to consider that the world war 3 is the solution to the current crisis).

      Delete
    3. I tend to label them as fascists but that often stops the conversation.
      WW III would be a lose - lose. Not sure I have enough bullets, bandages and beans to survive my neighbors when they get hungry.

      Delete
  11. Interestingly the overall hours worked in these payroll figures has gone down indicating all is not well in US economy. I think copper is right. Difficult to see Fed continuing taper beyond spring. Looks good for gold in the short-medium term. One more taper, then that could be it, especially as Obama is headed down the road of sanctions against Russia...

    ReplyDelete
  12. Joining us now, one of the most respected money managers in the world and acclaimed godfather of newsletter writters, to share an incredibly powerful piece of..wait a minute...oops, sorry, wrong channel, I'm back on Dan's blog now, I can write normally once again :)

    just a quote :
    "Market trends are ALWAYS real because nobody can manipulate the trend – not even government. Manipulations are short blasts within the trend – but you cannot shorten a bear market or extend a bull market ".
    (Armstrong Economics)

    I'm not sure...gold is small enough a market to be easily manipulated imho, because short and strong blasts are enough to lead the herd where you desire.
    After all, one good dog is able to lead and herd tens of sheep.
    Why wouldn't it be the same with gold at some extent?
    A good dog could herd a few dozen hedge funds and their algos easily?
    I'll never know for sure.
    But one thing I'll keep in mind is that even JS recognized that USD index is too big to be manipulated. Even ESF could not make much more than a small short balst on this market, defending supports, provoking short-term reactions, but oppose the trend? not. So I'm watching the USD index and EUR USD with a attention.
    So far, so good above the 1.3835 level, next fibo being above 1.42 but with some technical resistances on the way.

    ReplyDelete
    Replies
    1. Hubert; Armstrong is a letter writer with 10000 predictions on all the markets and all the geopolitical events occurring; it is dangerous to pay any attention to guys like him; of course he will be right on some things, but basically he is full of shit; sparks

      Delete
    2. Armstrong was one of the few "letter writers" out there that was warning sharp declines were coming in gold Q1 2013 and was spot on.
      If it was manipulation gold would have recovered back past 1530 and stayed, but it didn't.

      Delete
    3. Armstrong sells conferences jim sells shares. Neither can be trusted. Its really simple.

      Delete
  13. Hubert, your opening comment was hilarious. Funny how all those acclaimed experts who are predicting a crash, it hasn't dawned on them that the horrific epic plunge has already happened.

    In the mining sector. Ask any mining CEO who has seen his net worth decimated. In stark contrast to the net worth of CEOs of Facebook, Google, Chipotle, Buffalo Wild Wings, etc.

    And don't even get me started on Bill Gross who now lives on a private island in Newport Beach with a drawbridge, lol...

    ReplyDelete
  14. Speaking of international gold thieve's.....in plain sight, for "safe-KEEPING" of course :-o

    Tonight from "Borispol" in the U.S. strartoval plane with gold reserves of Ukraine



    As our site workers airport "Borispol", this night in 2-00, with the designated airport runway started unregistered transport plane ...

    According to the staff "Boryspil", before it came to the airport four collector car and two cargo minibus Volkswagen, thus, all the arriving truck license plate missing. Car pulled out of about fifteen people in black uniforms, masks and body armor. Some of them were armed with machine guns. These people have downloaded the plane more than forty heavy boxes ...

    After that, some mysterious men arrived too entered the plane. All loading was carried out in a huge hurry. After unloading the car without license plates immediately left the runway, and the plane took off on an emergency basis ...

    All who saw this mysterious "special operation" airport officials immediately notified the administration of "Boryspil", from which received a strong recommendation "not to meddle in other people's business" ...

    Later, the editors called back one of the senior officials of the former Ministry of income and fees, which reported that, according to him, tonight, on the orders of one of the "new leaders" of Ukraine in the United States has been taken all the gold reserves in Ukraine ...

    ReplyDelete
    Replies
    1. Oop's...forget the link to the Ukraine gold story above...
      http://iskra-news.info/news/segodnja_nochju_iz_borispolja_v_ssha_strartoval_samoljot_s_zolotym_zapasom_ukrainy/2014-03-07-9122

      Delete
  15. In Jim Willie's latest he compares the Venezuelan hyperinflation to that which will hit the US, and that John Williams will finally be right....this year, as opposed to the last 4 years. Wonder why Jim is never on KWN:

    https://www.youtube.com/watch?v=GjaCh0S2nu4

    ReplyDelete
    Replies
    1. Both those guys dead wrong for years, now a laughingstock on Wall Street. Energy, copper, iron ore prices in a full scale plunge yet Facebook is making new world record highs today.

      The only things experiencing hyperinflation are social media and alternate energy stocks, LOL!!!!

      Delete
    2. Dear Mr. Dan,

      Mark, Steeve, Elijah and others could be correct about shadowtats, jim willie or armstrong or kwn and similar guys who were negative on stock markets.

      What is your opinion on the same? Taking into consideration that if money velocity is shrinking, which suggests that borrowing, lending, consumption is falling, alongwith so many companies reducing their workforce.

      Would you agree that all the excess cash created by QE is responsible for the rise in stock markets past 5 years and fundamentals and economic reality is completely sad?

      Maybe timing of these guys is incorrect? or maybe QE will never allow a collapse?

      Delete
  16. All right, my missed call on silver on friday allowed me to get into the market now at exactly 20.60 i.e the top of the range 19-20.60 which sent us towards 22.20.
    Of course a resistance is an area, not a spot, but given the fact that silver is heading down anyhow, plus a few other things, my tactic remains the same, I put a close stop loss on that one. If the support holds, let it hold.
    If there is a head fake, well...I'll try to monitor the market today...problem with me is I rarely can :) :) so it's harder to trader on short time units.
    Let's see...I don't allow myself to lose more than 0.20 cents on that one, of course. Prices could easily reach 20.50 very soon because of a downwards channel on the 4h time unit, so I put my stop loss around 20.45.
    Reminder : the odds I get stopped are quite high and probably at least 50%. I compensate because my target is at least 22.20. It's the only thing that makes such trades "winners" in the long run. Small line of course.

    ReplyDelete
  17. This comment has been removed by a blog administrator.

    ReplyDelete
  18. I have a question to Dan and all experienced traders reading this blog :)

    Referring to this article :
    http://armstrongeconomics.com/2014/03/09/research-shocking-there-is-order-in-the-chaos/

    It's a question that's been in my mind for sometime, as I don't master all the tools of trading. First, let me explain my environment : most trading tools and analysis I know are focused on indicators based on the vertical axis...they try to anticipate price movements, price supports and price resistances, price areas of reversal...they watch prices, so they work on the vertical axis of a chart. In this axis, some esoteric numbers appear, such as the retracement ratios of Fibonacci, which indeed seem to work on many occasions and indicate targets, reversal areas, etc...

    Now what about the horizontal axis, i.e TIME?
    The question is indeed, do you work on that dimension?
    Are trying to forecast reversals, supports, resistances, not based on Price, but on Time?
    This is probably the methods of some other analyst, news letter writers, probably Eliott waves analysts? Is there an equivalent of the Fibonacci retracements levels on prices you are using on time?
    See the link I posted, this PI ratio is exactly the kind of tool I'm talking about.
    I think Jim mentioned the Fi ratio as well in one of his studies last year.
    Do you have any personal feedback on this kind of method, using time indicators as well as price indicators, and their result? Are you using the horizontal axis for your T.A and anticipation of price reversals?

    Thanks a lot :)

    ReplyDelete
    Replies
    1. Hubert;

      I personally do not pay any attention to time other than to look at seasonal tendencies. Once upon a time I tended to concur with the cycles thinking but not since the proliferation of computerized trading have I paid it a second thought. The computers do to markets in 1hour what once took days, if not weeks. The entire trading world has been turned upside down with the invasion by the hedge funds. Their actions make it almost impossible to position trade these days. the price swings are too severe to have positions on in the highly leveraged futures market and be unprepared for the extent of the swings in one's trading account.

      Delete
    2. Thanks a lot, crystal clear :)
      I'll try to make a little research of my own on the long term units, but more out of curiosity than to apply the system myself.
      It's funny btw, how many platforms fully integrate thousands of price indicators, but no time indicators, like a PI extension of a selected number of candles for example...if that way of thinking was really widespread among traders, I guess it would have been long time that we'd find its translation into the tools platforms have to offer :)

      Delete
  19. Yet another day where many are claiming huge economic depression and collapse yet crashing energy prices are causing transports like Southwest Airlines to print world record highs again today.

    And don't even get me started on Facebook, lol...

    At least gold is holding its own.

    ReplyDelete
    Replies
    1. Gold is holding since Bitcoin collapsed... :)

      Delete
  20. What the shorts are speccing for 2014 after the yet terrifying 2013 … Trader Dan in the roll of chief Brody

    https://www.youtube.com/watch?v=96wk9ok0dbw

    ReplyDelete
  21. Anon:

    The "world headed for disaster" already happened. Right now. In the gold and silver mining industry.

    More than half of the listed mining stocks in the TSX are penny stocks, if they were in the U.S. they would already be trading on the pink sheets.

    ReplyDelete
  22. GLD had an inflow of 8 tons yesterday.

    ReplyDelete
  23. Holy Copper! This is the supreme leader for the commodities. Thanks for the signal Batman. Silver next bottoming in July 2014. Yep.

    ReplyDelete

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