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Old 02-15-2013, 11:46 AM   #1
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Arrow I'm calling the bottom in gold

I'm sticking my head out here and saying that today is gonna mark the bottom of the current downmove for gold. Some reasons:

Technicals:
We broke major support levels at 1620 and briefly even at 1600. The breach of 1600 was aggressively bought which is great. It looks like we had a classical spike low. Overall volumes very just massive today.
Longer term technicals are at a crossroads here:
Chart is as of yesterday


1. you can see the massive support at 1620 which was the major resistance for the breakout last Summer.
2. The 50 dma is about to cross the 200dma to the downside. That would be bearish.
3. The momentum indicators RSI and AROON oscilator are pointing towards oversold. MACD is neutral.
Bottom line: either we rebound above 1620 quickly or we'll get major technical damage.

Physical demand:
It seems like there is some very sizable buying going on here, indicated by the rapidly falling forward rates: http://www.pmbug.com/forum/f2/negati...html#post18788

Paper positioning:
Open interest in gold futures has also been falling significantly: http://www.pmbug.com/forum/f13/open-...html#post18418
This weeks trading should have even intensified this trend. We will see what happened to oi until last Tuesday when the COT data is beeing published tonight.
Next weeks COT data might even be more interesting.

Chinese new year:
I think that Chinas new year holidays since Feb 9th have also had an influence on the price action in gold. We tend to monitor US (and European) demand closely. However, China already has a bigger influence on pms than the West. I'm anticipating solid buying from China once they return from their holidays on Monday. The Chinese new year holidays last one week. On the other hand Monday is a holiday in the US, too. That should give us "protection" from another COMEX attack which could eridicate any Asian overnight trading gains.


Note: I'm not talking about silver.
The dip below 30 wasn't bought aggressively. Paper postioning was very bearish. It doesn't look that great. To get anything going in silver, we need leadership by gold it seems.
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Old 02-15-2013, 01:28 PM   #2
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Gold closes COMEX trading clearly above 1600. That's very good news. We also had some short covering into the close.
Silver on the other hand closed clearly below 30. That's not a good sign for next week.
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Old 02-15-2013, 01:41 PM   #3
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We've had the highest volume since Nov6th in gold today.
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Old 02-15-2013, 03:06 PM   #4
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I have to disagree with you and I will explain why.

Today was the stock option expiry on the GLD as you can see here a gazzillion Feb 16, 2013 option calls were taken out of the money on this latest wack today.
Every 10K call position was rendered worthless today (every one)
http://www.nasdaq.com/aspxcontent/op...&qm_symbol=GLD

The world Gold counsel announced that the central banks around the world bought more Gold last year 2012 than at any time since 1964.

The country of India is trying to suppress the buying and hoarding of Gold by it's citizens, but they arent having it and sales continue through the roof despite everything they have tried. (inflation is going through the roof there because no one wants to buy paper derivatives because of the history the government has debasing the Rupee)

Options expiry on the Comex contracts are the last week of the month here in February. I see them pounding it next week even more going into that expiry. This is their last stand and they are going to hammer the shit out of the price before the explosion higher to shake out the week hands.






Originally Posted by swissaustrian View Post:
I'm sticking my head out here and saying that today is gonna mark the bottom of the current downmove for gold. Some reasons:

Technicals:
We broke major support levels at 1620 and briefly even at 1600. The breach of 1600 was aggressively bought which is great. It looks like we had a classical spike low. Overall volumes very just massive today.
Longer term technicals are at a crossroads here:
Chart is as of yesterday


1. you can see the massive support at 1620 which was the major resistance for the breakout last Summer.
2. The 50 dma is about to cross the 200dma to the downside. That would be bearish.
3. The momentum indicators RSI and AROON oscilator are pointing towards oversold. MACD is neutral.
Bottom line: either we rebound above 1620 quickly or we'll get major technical damage.

Physical demand:
It seems like there is some very sizable buying going on here, indicated by the rapidly falling forward rates: http://www.pmbug.com/forum/f2/negati...html#post18788

Paper positioning:
Open interest in gold futures has also been falling significantly: http://www.pmbug.com/forum/f13/open-...html#post18418
This weeks trading should have even intensified this trend. We will see what happened to oi until last Tuesday when the COT data is beeing published tonight.
Next weeks COT data might even be more interesting.

Chinese new year:
I think that Chinas new year holidays since Feb 9th have also had an influence on the price action in gold. We tend to monitor US (and European) demand closely. However, China already has a bigger influence on pms than the West. I'm anticipating solid buying from China once they return from their holidays on Monday. The Chinese new year holidays last one week. On the other hand Monday is a holiday in the US, too. That should give us "protection" from another COMEX attack which could eridicate any Asian overnight trading gains.


Note: I'm not talking about silver.
The dip below 30 wasn't bought aggressively. Paper postioning was very bearish. It doesn't look that great. To get anything going in silver, we need leadership by gold it seems.
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Old 02-15-2013, 03:31 PM   #5
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Looks like we are close to the support over the last year. You might be a little early, but probably not that much. Remember the correlation between gold and how much printing is going on - while there are deviations, gold always catches up before too terribly long (months, maybe half a year). We have some catching up to do, and I'm sure we will.

Personally, I'm waiting for my own dumb system to tell me to buy (it tends to be a little slow, but gets nearly all the move anyway) - it might be doing that soon, and waiting to see what clown show congress puts on re debt ceiling and budgets - it won't be long, and then there will be less uncertainty about the fed's course.

I think the key takeaway here is "it's time to pay close attention".
Remember, Soros and others have dumped paper gold longs. You're betting they were dead wrong. They might be, but...
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Old 02-15-2013, 03:42 PM   #6
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The GLD calls issue is interesting. If the counterparty of the GLD calls (JPM) is behind the current selloff, it would actually support my bottom thesis as they would cash in the premiums today after the close.
I don't disagree with you on the metals options expiries often marking major lows. However, the open interest for gold has already dropped significantly, so the incentive to manipulate prices ahead of the COMEX op/ex should be lower. The upcoming COT data will clarify that.
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Old 02-15-2013, 04:55 PM   #7
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Originally Posted by swissaustrian View Post:
The GLD calls issue is interesting. If the counterparty of the GLD calls (JPM) is behind the current selloff, it would actually support my bottom thesis as they would cash in the premiums today after the close.
I don't disagree with you on the metals options expiries often marking major lows. However, the open interest for gold has already dropped significantly, so the incentive to manipulate prices ahead of the COMEX op/ex should be lower. The upcoming COT data will clarify that.
You have to remember that the COT data is from the manipulative machine itself.
It's like using the VIX as a fear indicator (its a manipulated indicator)
At this point they dont care about the paper as it is about the physical metal itself. The commitment of traders are the paper gamers not the serious physical investors. They are trying to diswade the mom and pops from taking currency and exchanging it for physical metals. Thats what is going on in India right now. I hope that you spend some time and study the gold vs Rupee problem they are having because this is exactly what is going to occur in the U.S. "shortly"
I know the paper price is what the physical metals is priced with. I think this is going to change as in "India" take a little study of that situation I recommend it.
I learned a vast amount from spending a couple of days on it.
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Old 02-16-2013, 03:57 PM   #8
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Originally Posted by swissaustrian View Post:
I'm sticking my head out here and saying that today is gonna mark the bottom of the current downmove for gold. Some reasons:

Technicals:
We broke major support levels at 1620 and briefly even at 1600. The breach of 1600 was aggressively bought which is great. It looks like we had a classical spike low. Overall volumes very just massive today.
Longer term technicals are at a crossroads here:
Chart is as of yesterday


1. you can see the massive support at 1620 which was the major resistance for the breakout last Summer.
2. The 50 dma is about to cross the 200dma to the downside. That would be bearish.
3. The momentum indicators RSI and AROON oscilator are pointing towards oversold. MACD is neutral.
Bottom line: either we rebound above 1620 quickly or we'll get major technical damage.

Physical demand:
It seems like there is some very sizable buying going on here, indicated by the rapidly falling forward rates: http://www.pmbug.com/forum/f2/negati...html#post18788

Paper positioning:
Open interest in gold futures has also been falling significantly: http://www.pmbug.com/forum/f13/open-...html#post18418
This weeks trading should have even intensified this trend. We will see what happened to oi until last Tuesday when the COT data is beeing published tonight.
Next weeks COT data might even be more interesting.

Chinese new year:
I think that Chinas new year holidays since Feb 9th have also had an influence on the price action in gold. We tend to monitor US (and European) demand closely. However, China already has a bigger influence on pms than the West. I'm anticipating solid buying from China once they return from their holidays on Monday. The Chinese new year holidays last one week. On the other hand Monday is a holiday in the US, too. That should give us "protection" from another COMEX attack which could eridicate any Asian overnight trading gains.


Note: I'm not talking about silver.
The dip below 30 wasn't bought aggressively. Paper postioning was very bearish. It doesn't look that great. To get anything going in silver, we need leadership by gold it seems.
Very good write up sir but I respectfully disagree. Main reason is silver looks to be ready to test the DMA. September, December, July, all tested 26.06 or so. So now, we don't want to test that low or it will violate the uptrend chart pattern of higher highs and lower lows. Luckily the DMA is above both of those and would show a bullish strength should it hold there. RSI is also not entirely oversold at the 30 (silver) as it normally does on these dips.

I suspect silver to see $27, and gold to test $1,595 or so. All in my opinion gltya

Last edited by ILOVETRADING; 02-16-2013 at 04:00 PM.
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Old 02-20-2013, 08:55 AM   #9
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http://www.321gold.com/editorials/ho...mes022013.html
http://www.advisor.ca/investments/ma...-sprott-108211

There seems to be a number of people that agree with swissaustrian. We are in a nice buying opportunity as long as the price remains under $1,600!
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Old 02-20-2013, 10:26 AM   #10
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As I posted yersterday in a different thread on this forum...

Quote :
I see silver and gold being smashed a fair bit more. I think we are entering the end game here, and if that is so, you will see a shakedown that will try to loosen the strongest hands possible.

I see support levels being broken, and the general consensus changing to say PMs are now in a bear phase.

Hold on. The roller-coaster is just getting going.
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Old 02-20-2013, 01:02 PM   #11
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I still think you are all wrong. This pummeling has not ended (as foretold above) There are two factors. The Comex expiry next week Tuesday, feb 26, 2013 (as noted above) and the FOMC statement that will come out in 1 hour from now. I believe you are gonna see the "BIG" hammer come out after the release of the lies from the FOMC.

Get ready for another huge downdraft after the FOMC lies are released.

1 hour, be ready to load the boat this weekend !
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Old 02-20-2013, 03:13 PM   #12
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GOING LOWER people. Sticking by my $27 silver target. Possibly 26.50.
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Old 02-20-2013, 03:47 PM   #13
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I have given up predicting the future, especially short term. But, often a SHARP move down leads to a two - three days more of some losses. JMO...

But, it really does not matter! Our ounces are still there! We will win. "They" will lose.

NONE of our problems have been solved.

NO ONE, of consequence, has been put in jail.
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Old 02-20-2013, 03:47 PM   #14
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Funny thing is that silver is holding up better than gold today since the fomc announcement. That is totally weird given the fact that there is huge speculative postioning in silver which should have been causing additional volatility. On a day when gold is down 2.8% you'd expect silver to easily be down 4.5%, instead it's down just 3%.
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Old 02-20-2013, 08:56 PM   #15
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This shake-down will be savage. It will scare even (some) die-hard pm bugs. I think they are going to try take gold to 1500 and silver to 24.

I probably won't get any 'likes' for this, but that's OK. Wise folks will like the opportunity to buy real stuff at those fake paper prices.

They need to crash PMs before they can crash the stock market and that is where they will get the most wealth extraction from the population.

Never forget what the game is, and never forget how to play it.
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Old 02-21-2013, 06:43 AM   #16
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why, you got "like" from me I agree, I think "they" would be willing to sacrifice & completely break the paper metal markets at some stage, if the "integrity" (ie: survival for a little bit longer) of the rest of global financial system was at stake. We are most probably not there yet, but we will get there eventually, I think.
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Old 02-21-2013, 03:06 PM   #17
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We may not be right there at the moment, but if not, we are very, very close. I think time between now and the final leg of the 'end game' is to be measured in weeks, not months, but certainly not in years.
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Old 02-21-2013, 03:42 PM   #18
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sadly. this feels like another rinse and repeat, rather than the end game ............

theres still a lot of (misplaced) optimism out there ........

and the 'mutually assured destruction' card is always lurking ........

Why not play to our 'doomer' fears and see who rolls over ?
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Old 02-21-2013, 05:39 PM   #19
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rb - It's called 'convergence'. There are too many things coming down the pipe at the same time for it all to be coincidence. Granted some of them are beyond the control of TPTB, like drought and food shortages.

PM price manipulation does not exist in a vacuum.
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Old 02-22-2013, 04:25 AM   #20
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These things coming down the pipe are known and predictable and hence manageable.
No one who is 'in paper' will do anything to rock the, obviously fragile, boat.
The manipulators can continue to move markets and benefit themselves.
The food shortages that were being predicted two years ago did not really manifest.

It will take a genuine, large and damaging 'black swan' event to really change things ........ several factors larger than fukushima )-:

My hope/bet is that the controllers will maintain control and that they will allow gold to reflect its intrinsic value from time to time but never allow it to go through the roof.

The alternative is not pretty, so be careful of what you wish for.
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