Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 Tomorrow's August employment report should show continued job losses with the potential to drive home the awareness that not only does the asset-price dependent US economy continue to be in the worst shape among the world's major economies, but also that the Fed will be forced to remain on hold with its 0% rate far longer than most currently expect. IMO, to the extent this fact is realized, the extent it can drive down the vulnerable US Peso. When something trades this long in a tight range, in this case Gold, the ensuing move tends to be explosive in nature, especially given such a bullish set-up. Since the broad markets have been overdue for their inevitable correction, and since broad market down = USD up has been in the playbook for the past year, the fact that Gold/Silver were exceptionally strong may signal the inflection point I feel is fast approaching. With liquidity remaining strong, I continue to opine "this is NOT Fall 2008" as many fear. I expect the correction in the broad markets to run its course by middle to end of next week. Things should get interesting for Gold/Gold Stocks after labor day when volume comes back and the recognition phase sinks in. The US Treasuries couldn't even manage a bounce with the stock market falling. And that was despite the Fed's monetizing another $5.6 Billion today! Another negative for the US Dollar/UST-Bonds. I'm reminded of last Dec-Feb period when Gold continued to rally despite the US Peso rising to hit its 52-Week MA. So hopefully, today's gold bullish divergence action was not just a one day event. Similarly, the bullish divergence of Gold and the foreign currencies which indicates the US Peso rally will soon fail. Watching and waiting. And Gold "explosive in nature" it was! The ADP employment report revealed that 298,000 private sector jobs were lost in August, well above the 250,000 consensus, and that obviously doesn't bode well for Friday's jobs report either. So for anybody that thought the "asset price" based US economy was going to suddenly pump out a bunch of new jobs (like other economies around the globe are already doing), this was a big disappointment. It was also another reminder that the Fed is going to be forced to remain easy for a long, long time, unless of course the Fed becomes panicked due to the dollar having a mini-collapse of sorts, which it may well do. The dollar also weakened on the news and gold rallied nearly $10. Coincidence? Link to comment Share on other sites More sharing options...
dharma Posted September 3, 2009 Report Share Posted September 3, 2009 mmg, broke out dharma Link to comment Share on other sites More sharing options...
bearvest Posted September 3, 2009 Report Share Posted September 3, 2009 !0% short Link to comment Share on other sites More sharing options...
Whadda I Do Whadda I Do Posted September 3, 2009 Report Share Posted September 3, 2009 Let's see if $990 holds here. Daily rate of ascent not to bad. Link to comment Share on other sites More sharing options...
Charmin Posted September 3, 2009 Author Report Share Posted September 3, 2009 HUI takes the higher road to a new high http://www.StockSharePublishing.com/ChartL..._1252005760.png Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 How’s everyone enjoying the ride? Keep those seat belts on! Oh, . . . I see the VIP section only has 3 passengers on board. More champagne Sir? Hmmm . . . And the 1st Class section just a couple. But the coach class empty? Where is everyone? :( Ah yes, the Bull Market takes along as few passengers as possible. The “Fundamentals Are Useless” are always left holding the bag at the bottom. And these same bag holders will later claim they were long or some such nonsense. Now keep your hands and feet inside the space ship goobers! Link to comment Share on other sites More sharing options...
dharma Posted September 3, 2009 Report Share Posted September 3, 2009 !0% short you may make $$$ on the trade, butt you missed the trend! counter trend playing never yields results over time dharma Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 Bearish? I've simply stood aside. And said so repeatedly. Simply in cash. Did a small day trade in the QQQQ's short on Monday. All I see are 3 wave moves---including Wednesday's "pop" which could be a "C" wave. Once Stochastics gets above 80 again and forms a reverse double dip, I'll consider shorting thie P.M.'s. If there's a fundamental reason for this, it was lost on the bond traders who drove interest rates lower in all maturities. It was also lost on the inflationists as the Dolllar, Oil and copper were flat. From what I can see, this was an isolated event in the Gold market. Could be that the large specs decided to raid the COT'S. It was purely a North American event. Bear"vest", with all due respect that comes with such title, perhaps I should have given your conclusions above (which I consider uneducated, poorly conceived, completely inaccurate and dangerous to one's financial state of affairs) a more thoughtful response for the benefit of those here trying to learn so that they "Make Money" as opposed to losing it. These are my humble opinions so there's no need for you to characterize me as "arrogant and pompous" for stating them. I was reminded of your views after watching a bit of "Hee Haw" to keep tabs on the Market Consensus Ignoramuses pulse. And sure enough, they're (MCI) as stupified as ever, in my humble opinion of course. I say this because of the sheer amount of misinformation being spewed there and on the other media channels with respect to gold. No wonder these MCIs are so ignorant! Anyway, I thought I would (humbly) set the record straight for anyone interested here. Gold doesn’t rally sharply like it is doing now after exploding out of its 6-week wedge (and especially not in conjunction with strong moves in both silver and the gold stocks) for “no reason” or because of an "isolated event" as you claim above. And Gold's breakout is clearly NOT just "Purely a North American Event" as you state. Makes me wonder what you're looking at!? Investors, especially the deep pockets discussed here, do NOT buy gold because they are “scared.” It’s not food or some sort of security blanket they can wrap around them to keep them warm at night. It’s “GOLD” Bearvest. It’s MONEY, a CURRENCY and (most importantly) the ULTIMATE RESERVE ASSET FOR THE WORLD'S CENTRAL BANKS. Investors buy gold for a couple IMPORTANT reasons: 1. fear of Currency Depreciation which leads to 2. Price Inflation, for obvious reasons discussed here over the years. The fact that the precious metals complex has rallied as sharply as it has over the past few days even as the dollar has basically gone nowhere is sending a very loud signal (DING DONG . . . DING-A-LING!!! . . . DONG!) that the US dollar is about to have an accident, just as gold’s rally in conjunction with the dollar’s rally in January and February told you that the dollar would soon be peaking, which it did in early March. Likewise, on an even shorter term basis we saw similar action on Tuesday when despite the dollar’s sharp rally, gold closed higher. That Tuesday intraday peak in the dollar index has by NO COINCIDENCE been the peak for the bounce this week too. Recall that the Market Consensus Ignoramuses claimed gold was rallying back in January and February along with the dollar merely because of “panic” or “fear” too. It turned out that the gold market was actually much smarter than it was given credit for then, and odds are that we’re seeing the same movie playing out here again. To see gold lead the dollar in this way is a common pattern I have seen over and over through the years, and it’s not one to ignore, especially one to short! Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 More of my humble opinion to combat what I describe as outrageous ignorance based on the clueless, blinded view that "Fundamentals Are Useless." Warning: NO "DRINKING WHILE THINKING" ALLOWED! PUT DOWN THAT TALL GLASS OF SCOTCH BEFORE PROCEEDING! (Brain needs oxygen and thinking required for a possible "connection of the dots" epiphany to usher in the recognition phase.) I’ve highlighted before the fact that while the asset price-based US economy remains in recession (see today's Services ISM that remained in contraction territory) that much of the rest of the world has emerged from recession for the most part. I've also highlighted that this fact should weigh on the dollar at some point. We’re now seeing this process at work in the fact that ahead of the G20 finance ministers meeting in London this weekend there is already growing disagreement between the US and the rest of the G20 with respect to reining in stimulus measures. Because the US economy remains weak, Geithner is arguing that the stimulus must continue, while many of the other G20 ministers are leaning towards initiating “exit strategies” due to the fact that their own domestic economies are roaring back. It’s precisely this friction that should weigh heavily on the Dollar, and this weekend’s G20 finance ministers meeting in London could be a key event for the US Peso. In fact, gold’s sharp rally over the past few days may even be hinting that a negative catalyst for the Dollar will emerge from this weekend’s meeting. Get it? Geithner Says Too Early for G-20 to Withdraw Stimulus http://www.bloomberg.com/apps/news?pid=new...id=a3RmwDYoAxTI This guy seems confused . . . did he really think the Chinese University students would buy his "Strong Dollar" pablum? Ministers plot rolling back stimuli measures High on the list of topics for G20 finance ministers meeting in London this weekend will be when, and how, to unwind the massive and unprecedented fiscal, monetary and financial sector stimulus that has been put in place in capitals around the world over the past two years. UK ministers have said that there is widespread agreement that although there are signs of a nascent recovery not only at home but in Europe, Asia and the US, it is still far too early to begin rolling back stimuli on any grand scale. http://www.ft.com/cms/s/b9dda4c2-98b0-11de....asp%3FID%3D530 Economies rise but politicians stay cautious By Krishna Guha Published: August 31 2009 17:08 | Last updated: August 31 2009 17:08 The world economy is bouncing out of recession with more initial vigour than many thought possible until very recently, setting the stage for a strong third quarter in almost every corner of the globe. Just as economic activity fell sharply everywhere following the Lehman crisis in September 2008, the first phase of the rebound looks remarkably synchronised, with economies rising in tandem across the world. http://www.ft.com/cms/s/386b0290-9644-11de...%253FID%253D530 Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 Bearvest, with all due respect, and in my humble way, I want to express that I have not completely given up on the remote possibility that you may yet, someday, "get" what I've been explaining here for the past 5 years. (OK sorry, that would be a lie. But I can say that I will never give up on hoping for such.) So let's pretend this is a military style "prep school" where students are seated in order of demonstrated intelligence from the "smartest" #1 in the back right corner to the the "dumbest" #50 in the front left corner next to the instructor's desk. The instructor, Mr. Whoeleb, a German born former NSA economist sporting a heavy accent, calls the classroom to attention. Pupils with coat and tie rise smartly to salute and then sit to listen intently. Bearvest, pay very close attention. Pretend that you're #bottom50 sitting in the very front corner in "number one dummies row chair" adjacent to the instructor's desk, and he's addressing his lecture while staring at you! Mr. Whoeleb staring intently, "Herr Bearvest, was mit China und dem US-Dollar meine dummen kleinen Kursteilnehmer geschieht!?" "Oh vergaß ich, das Sie, sprechen Amerikaner nicht Deutsches!" "Vas is going on behind der scenes mit China und der Dollar, herr Bearvest? Beantworten Sie mich Junge! "Letzte Woche, der Chairman of China Investment Corp, which ist China’s sovereign wealth fund, said, "Both China and America are addressing bubbles by creating more bubbles und we're just taking advantage of that. So we can't lose... We have to be in everything because you never know what's going to happen in this world.” Herr Bearvest, tonight's assignment, read der following article und prepare a report. China's CIC wealth fund muscles up as markets recover http://www.reuters.com/article/ousiv/idUST...0090829?sp=true "Und then I want you to consider one of Mineweb's articles this morning which states that several reports are suggesting that China’s sovereign wealth fund ist under pressure zu rapidly build investments in non-Chinese enterprises, particularly in der oil und precious metals sector." "Now think, could it be that this urgency to buy oil und precious metals assets is due to der fact that China knows der days are numbered in which she can continue to inhale dollars und print yuan at an ever faster rate in order to hold down her currency? Given der move in gold this week und der continued pressure on der dollar, one wonders what could be going on behind der scenes, herr Bearvest?" A recent Mineweb article writes: "In an interesting, but perhaps disturbing footnote to the Thunder Road Report mentioned above, Paul Mylchreest comments that in Latin America, where he has been living for 25 years, for the first time he can remember, locals are now preferring their own currency to U.S. dollars. He goes on to finish with this comment: "If a fellow with no education, a poor diet, and inadequate medical treatment living at 3,500 metres above sea level can figure out that the US dollar is undesirable as a store of wealth, how much longer do you think it can last as the world's reserve currency." "Haben Sie jetzt einen schönen Tag meine Kursteilnehmer. Jetzt werden Sie von der Kategorie entlassen. Vergessen Sie nicht, Ihre ökonomischen Lektionen mit Sorgfalt zu studieren." Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 JUST SAY NO TO MOROONS! Another "Oct '08 Back Up the Truck" stock over-sold to extreme price relative to value inevitably now being recognized given its fundamental underpinnings! All it took was a little patience and understanding of fundamentals to buy value at the bottom. Come tuh papa, muh lil' darlin'! Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 Uh . . . wha' dis'???… Uh not showin' up on muh charts anywheres!! Uh . . Hong Kong recalling its Gold Reserves from London???!! Wha' da Hail fo'!!!?? Wha' duh Hail Goin' on chere!!!???????? Sheeeeeittt!!!!!!!!!! Hong Kong recalls gold reserves, touts high-security vault In a challenge to London, Asian states invited to store bullion closer to home http://www.marketwatch.com/story/hong-kong...-03?siteid=nbih Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 Yuh no goobs . . Sometimes the hardest part for most Gold Boos is just sittin' tight with your longs and allowing the rally to fully unfold due to the fact that it has always paid to sell strength over the last year and a half within the trading range. If this is the move to new highs in gold, like I believe it is, then this will be the one of the rare times (as experienced at the previous break-outs) that selling strength (never mind shorting a dominant secular trend . . yikes!) will be a huge mistake. And I'm not talkin' 'bout pausing from time to time to catch its breath. Tomorrow is the jobs data report which has a history of Dollar rallies and Gold consolidations along with expected Fed reassurances, but we'll just have to see. Now won't we. Link to comment Share on other sites More sharing options...
Whadda I Do Whadda I Do Posted September 3, 2009 Report Share Posted September 3, 2009 Last night I was looking for laggers and spotted MGN but it gapped my buy, even 14% up it still looked good to me, I bought, it was up 30%+ for the day. Rolled over most of my GGN into NG. I guess BV is not ready for those once in a lifetime moves. I myself will start looking to book some profits after spot clears $1000. Link to comment Share on other sites More sharing options...
Gold Majestic Posted September 3, 2009 Report Share Posted September 3, 2009 I've commented here in the past that, in my humble opinion, Dennis Gartman was not the sharpest crayon in the box. More of a contrary indicator at times. But in all fairness to him, at least he's way beyond and above the "Fundamentals Are Useless" mob in that he has a passion for understanding the factors shaping the markets. With that said, he's been a contrary indicator at times because of his style of investing which is to buy strength and sell weakness. Of course that style is always exactly wrong when something is in a trading range (like gold has been for over a year) given that strength leads to a peak and weakness to a bottom, etc., which is why he has been so perfectly wrong in gold over the past 9 months or so. [in other words, that style of trading is only right ONCE, and that’s when you break out of the trading range (up or down).] But what sets him apart from the Prechter moroons that abound in the markets is that he's actually been BULLISH AND LONG for several weeks now. And even though gold has beaten Gartman into submission to some degree over the past 9 months and forced him to try and save face by being long gold “in euros and pounds," the fact is that he’s finally been right in being long gold “in euros and pounds” for several weeks now as it’s rallied. So one could note that because of the nature of his style of trading, it could be another confirmation of sorts that this time is different too… that this move is “the real deal” that will in fact take the metal to new highs and not just a bounce in the trading range. Another reason to take this rally day by day, and definitely not try to foolishly pull a high risk "Moroon" by attempting to short this break out. Link to comment Share on other sites More sharing options...
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