8 replies to this topic

[norton]

All commodity bull markets eventually end, and almost always when it is believed by virtually everyone that the advance absolutely cannot end, because, well just because, and mostly because "they" are long. I see nothing precious about gold and silver, just because they have come this far in price is no guarantee that they will go further up in price, to me anyhow. Silver hit $15 and has shown it can, and did, sell off 22% to the mid $11 area (pat myself on the back for taking 100 points on the short side). A similar sell off in cash gold would take it from $725 to around $565, a good $100 an ounce lower from here, nicely the same level as last October's lows. Gold has not broken down like silver has because it is much more liquid, and therefore like a freight train, takes some time to get moving. Well I think it is starting to move now, many of the gold equity stocks and ETFs look like they have broken down. Cash gold sits on long term moving average support, for good reason - the world is long and hopes it will go higher. I am starting a short selling campaign here, 1/3 short Dec futures at $668 today, buy stop $690, sell stop remaining 2/3 at $655 and $648. Tell me there is no one here who agrees with me. .. Please.

Edited by norton, 23 August 2007 - 08:12 PM.

[Tor]

Norton, good to see you. i posted in the last few days gold is about to CRASH in september. Down to 550 on the cards. On the gold board.

Edited by Tor, 23 August 2007 - 08:15 PM.

[atlasshrugged]

All commodity bull markets eventually end, and almost always when it is believed by virtually everyone
that the advance absolutely cannot end, because, well just because, and mostly because "they" are long.
I see nothing precious about gold and silver, just because they have come this far in price is no guarantee that they will go further up in price, to me anyhow. Silver hit $15 and has shown it can, and did, sell off 22% to the mid $11 area (pat myself on the back for taking 100 points on the short side). A similar sell off in cash gold would take it from $725 to around $565, a good $100 an ounce lower from here, nicely the same level as last October's lows. Gold has not broken down like silver has because it is much more liquid, and therefore like a freight train, takes some time to get moving. Well I think it is starting to move now, many of the gold equity stocks and ETFs look like they have broken down. Cash gold sits on long term moving average support, for good reason - the world is long and hopes it will go higher.
I am starting a short selling campaign here, 1/3 short Dec futures at $668 today, buy stop $690,
sell stop remaining 2/3 at $655 and $648. Tell me there is no one here who agrees with me. .. Please.

i wont agree with ya! Only because its been so long since we spoke that I cant wait to have you hit me back!!

[Rogerdodger]

I took a poll this weekend.
Most looked for deflation and a reduction in commodity prices.
Poll Results

[norton]

I took a poll this weekend.
Most looked for deflation and a reduction in commodity prices.
Poll Results

----------------------------
Not talking about commodity prices or deflation, only the direction of one thing, gold.
Our gold board does not indicate many short positon holders, does it?

[Rogerdodger]

Tenuous:
http://stockcharts.c...653245&r=40.png
http://stockcharts.com/c-sc/sc?s=$HUI&p=D&yr=0&mn=6&dy=0&i=p24527382819&a=53230925&r=541.png

[Woody]

Norton great to see your post! While I agree with you on direction in the st a few concerns.........isnt September seasonally the strongest month of the year for Gold? Also, the COT Commercials while short are less short than they normally are..this may not mean much but just throwing it out there. Now a major shift to deflationary concerns can trump Cot and seasonality..Carl Swenlin at DP has a nice theory where we are making a rounding top after the spike high similar to 1980..... be careful out there! CW

[Trend-Shifter]

Gold seems to have devilish roots, it loves $666 Anything above is bullish and anything below is bearish. Right now gold has no direction as it bounces on the road to hell!

[Cirrus]

All commodity bull markets eventually end, and almost always when it is believed by virtually everyone
that the advance absolutely cannot end, because, well just because, and mostly because "they" are long.
I see nothing precious about gold and silver, just because they have come this far in price is no guarantee that they will go further up in price, to me anyhow. Silver hit $15 and has shown it can, and did, sell off 22% to the mid $11 area (pat myself on the back for taking 100 points on the short side). A similar sell off in cash gold would take it from $725 to around $565, a good $100 an ounce lower from here, nicely the same level as last October's lows. Gold has not broken down like silver has because it is much more liquid, and therefore like a freight train, takes some time to get moving. Well I think it is starting to move now, many of the gold equity stocks and ETFs look like they have broken down. Cash gold sits on long term moving average support, for good reason - the world is long and hopes it will go higher.
I am starting a short selling campaign here, 1/3 short Dec futures at $668 today, buy stop $690,
sell stop remaining 2/3 at $655 and $648. Tell me there is no one here who agrees with me. .. Please.

From this AM:


There are some interesting developments in this market. The Nymex open interest is 330,000 contracts with gold at $670. This level is 100,000 contracts below its highs earlier in the summer. What this means is there is no speculative froth in the market and these levels of open interest usually portend a coming rally in the metal.

A day before gold's thrashing, gold lease rates hit a year long high by increasing three fold. What this means is demand to borrow gold and sell it on the market has increased substantially. This corresponds to an absence of European Central Bank selling. Today lease rates have reached highs of last week, so market participants are aggressively selling leased gold. Leased gold can be thought of a short's method of last resort to prevent gold from moving up.

Japanese futures markets are infinitely more open in reporting data than in the US. February 2006, Goldman Sach's opened a gold trading arm on TOCOM (Japanese exchange). Since then, their position in gold is to be significantly net short to the tune of 35,000 - 55,000 contracts. TOCOM reports positions of trading members daily so you can see how players position themselves. One thing interesting of note is Goldman Sachs would come out with a bullish notes on gold and their TOCOM position would become more net short prior to and the day of the announcement. Over the last week, there has been a scramble by Goldman Sachs and other Japanese Companies to cover their shorts. Goldman has reduced their net gold short position from 19,400 last Friday to 11,400 today almost halving their short position in under a week. This is the lowest net short position they have ever had and may also be the most aggressive rate they have covered their shorts on this exchange. Overall, TOCOM has the lowest open interest since 2001. Again this is bullish since gold is $400 higher than 2001 and speculators are a long ways from having overbought the metal.

Physical demand from the Middle East and India is soaring. Many importing countries are reporting demand increases of 30%+. India is the largest consumer of the metal. They had a large shift in political power last year due to escalating inflation. Consequently, India has allowed the Rupee to appreciate 15% over the last year to lower import prices. What this has also done is given the Indians a 15% discount for the price of gold. Their imports of gold may now be on track of approaching 1000 tons or half of the world's production this year.