Jump to content
drbubb

Gold Comments - 2nd Half

Recommended Posts

Hi all! First time for me to post here. I have been a reader of bhc investment edited by a guy who calls himself Boon. I think Boon is also expecting a bottom in Gold to form very soon, though he bought it slightly above 850:

 

Chart.png

 

Note #3: Crude Oil broke out of its 100 psychological level before making its roaring surge to 14X (see figure above). That roaring surge was what happened after a pullback re-action. The pullback in Gold right now is a similar re-action following the breakout of 850. Once this re-action is completed, Gold will enter its next roaring surge. Panic selling Gold now is like selling Crude Oil at 95 before its roaring surge to 14X.

 

Note #4: Different analysts will always have different views on things, because (1) they don't know what they are talking about; and (2) they focus on the wrong time frame. The most important time frame for Gold is the multi-year chart (see figure above).

Share this post


Link to post
Share on other sites
Hi all! First time for me to post here. I have been a reader of bhc investment edited by a guy who calls himself Boon. I think Boon is also expecting a bottom in Gold to form very soon, though he bought it slightly above 850:

 

Chart.png

 

Welcome, YuChen. ANy relation to the family of painters? If so, say hello to ChenYu

 

I want to see Gold back above $850 soon.

There's a gap to fill near there. Let's hope once it fills the gap, it keeps powering higher.

 

It looks like the Chinese were in on the Dollar manipulation. So my "olympic opening turn" thesis was wrong/

But I think people everywhere can see value in Gold at these levels, and there's a good chance the bottom is

being put in.

 

OIH bears watching, and it si moving up strongly today (so far), and oil/USO is rising too

 

Share this post


Link to post
Share on other sites
Welcome, YuChen. ANy relation to the family of painters? If so, say hello to ChenYu

 

I want to see Gold back above $850 soon.

There's a gap to fill near there. Let's hope once it fills the gap, it keeps powering higher.

 

It looks like the Chinese were in on the Dollar manipulation. So my "olympic opening turn" thesis was wrong/

But I think people everywhere can see value in Gold at these levels, and there's a good chance the bottom is

being put in.

 

OIH bears watching, and it si moving up strongly today (so far), and oil/USO is rising too

 

Is very kind of you DrBubb! I am trilled to have found your fantastic forum here!!!

 

No, nothing to do with the painters.

Share this post


Link to post
Share on other sites

COMEX closed at 814.5, day high 842.9. Not a very good close but I think a bottom should be in either this week (1 more trading day to go) or next. Fingers crossed!

Share this post


Link to post
Share on other sites

TECHNICALLY, A near perfect set-up - Why is no one here commenting on it??

========================

 

I had to go to bed last night before the latest drop in Gold, and so was a little surprised about what happened.

I bought some more Calls thru an open order, and would have bought more if I had seen the late action.

Why has no one here commented on how perfect this set-up is?

Have you guys not been reading my posts? Maybe I will have to lay this out step-by-step.

 

(Before doing so, there is nothing guaranteed about this analysis. Often enough, a market will look perfect technically,

and get torn to shreds anyway. But it is nice to see what his happening, and watch how it plays out.)

 

There was too much complacency when Gold hit $850. Too many, myself included, bought there (me: calls), thinking

that support would hold. But on a micro-basis the charts weren't right. This time, with Gold testing $800, it looks

like they might be.

 

The first thing people need to realise is that Gold moves are being driven by Oil moves. Now fundamentally that makes

some sense. But I am basing this comment on charts, not fundamentals. Gold has been following oil for some weeks

and Oil has been following Oil service stocks. So in thinking about Gold, I have turned my attention to Oil and OIH.

Here's a comment that many here seem to have missed:

 

"QUOTE (bigtbigt @ Aug 14 2008, 12:54 PM)

my bones are telling me we might today be due a smackdown in oil, and therefore gold also

...hope I'm wrong"

UNQUOTE

 

Alot of people are worried about such a possibility.

When it doesn't happen, and the prices just sheds a bit, and stays above the recent lows,

that will be a good sign that Oil and Gold now want to go higher (that's my expectation anyway)

 

I do think that we have only seen the A-wave of an A-B-C correction in Oil.

And I believe that we may have seen the end of the C-wave in Gold. so in then next little while.

they can both go up together.

 

So what happened?

 

bigkl0.gif

 

Look closely, Gold (GLD) made a new low, but both Oil (USO) and OIH held above their prior lows.

That is what I had expected and hoped for. If Oil is going to lead Gold higher, you want to see Gold making

its last low, while Oil low stays above prior lows. That is what happened yesterday.

 

Now lets look at the detail of that Gold low, using GLD as a proxy.

 

aa2dz7.gif

 

What we have here is a new low in GLD on pathetically low volume.

Doesnt this chart look alot like the one I posted fot OIH, saying: "This is what a low should look like."

The OIH low held (so far), and I think there is a very good chance that this GLD one will too.

 

Thursday's GLD: Day High 81.0996 / Day Low 79.28

 

Let's look at two other reasons why GLD-79.28 might be a good level to form a low:

 

+ Historical gap, as described and posted before (Gold left this gap at Christmas time)

aa5fi3.gif

 

+ Support on longer term, charts, here is the monthly, showing $800 support:

biglg1.gif

The key MA here is 18 months, that's 377 trading days

 

+ And Gold is at channel support on the Weekly chart

aa3eg7.gif

 

+ Gold shares, have started outperform Gold again, in the last day or two

bigpn3.gif

 

Other factors:

 

+ Gold now is deeply oversold, with longs frightened- many have covered

+ Mid-August is usually a great seasonal Buy in gold

+ Full moon due today (?) & that often provides good turning points

+ Fundamentals (inflation, money growth, war, etc.) still favor gold

 

Why do I call it "near-perfect", rather than perfect?

 

I do not like the looks of this weekly chart- especially the last week or two.

bigad7.gif

 

The latest break could be nasty indeed. Some key support has gone on this chart.

Such breaks can sometimes kick-off disasters. Hence I am playing this thru Calls.

I want to see it scurry back inside that lower Bolly, very soon.

 

If Oil has finished its A-wave down, and makes a good rally here, the Weekly break

above could be turned into a bullish "false break".

Share this post


Link to post
Share on other sites

So after all that work:

We get a break of the support outside NY trading hours !

 

 

Share this post


Link to post
Share on other sites
Whats your take on this sudden drop?

PPT again?

Maybe. By hitting gold this hard, they try to cover the damage from the very bad inflation number

 

But remember one key thing: The high in Gold was all outside NY trading hours.

And maybe this low will be the same.

 

Anyone know what is happening to oil??

 

=2/

Interesting yesterday, that you mentioned Gold moves are being driven by Oil moves, it reminded me of a Fox business panel discussion from last week on Peter Schiffs site, where Gary ?Calpol? was very instant that Oil prices are being moved by the Financial stocks. He said that Financial stocks are leading the market up and down and that when they top out, that will be it for the market.

 

http://www.europac.net/Schiff-Fox-8-6-08_lg.asp

My point is this:

I wont get too disturbed by moves in Gold here (outside NY hours) that are not also confirmed by Oil moves

Share this post


Link to post
Share on other sites
TECHNICALLY, A near perfect set-up - Why is no one here commenting on it??

 

DrBubb, very interesting analysis. I think sometimes you need to use a bigger font :D :D

 

1. Isn't it the typical situation? People see a huge drop and get scared. At the exact time they should be looking at going in, they are doing nothing but worrying and thinking of getting out.

 

2. I was pretty sure we'd hit a bottom a few days ago. That got broken. Gold is holding up well, but the hit to silver is something to behold. Now that is one buying opportunity, when it bottoms !!!

 

3. Another post reminded me of the idea that we could have large gold sales to try and save the banks. That for a brief time the price will get knocked beyond belief, and outside any technical analysis, and that buying would become difficult. And that then the price would rocket uncontrollably.

 

Is this "the end game" ?

 

Share this post


Link to post
Share on other sites

Well this looks like another Ugly Friday for gold.

 

Another promising Support level has gone, teken out be dollar strength/ gold weakness.

 

I certainly feel and look as though I have lost my "touch" for the time being.

 

 

Share this post


Link to post
Share on other sites

I am no expert, but I think there are "confluence" of reasons to believe a bounce is about to take place:

 

COMEX Gold:

 

GCD.png

GCW.png

GCM.png

 

CME Japanese Yen:

 

JYD.png

JYW.png

JYM.png

 

USD Index:

 

USDD.png

USDW.png

USDM.png

 

All the weekly and monthly charts are hitting a line where a bounce tends to occur.

 

EMA's used: 81, 20.

Share this post


Link to post
Share on other sites
I am no expert, but I think there are "confluence" of reasons to believe a bounce is about to take place:

 

What a nice word to use to describe the present.

 

Pronunciation: \ˈkän-ˌflü-ən(t)s, kən-ˈ\

Function: noun

Date: 15th century

 

1: a coming or flowing together, meeting, or gathering at one point <a happy confluence of weather and scenery>

2 a: the flowing together of two or more streams b: the place of meeting of two streams c: the combined stream formed by conjunction

 

Share this post


Link to post
Share on other sites

Still in channel...

 

This Gold breakdown is really a "Dollar phenomenon".

Take a look at Gold-in-Euros, its still in the channel at Eur.550 / oz.

001lb3.png

Share this post


Link to post
Share on other sites

Gold up $17 to $803

 

First FULL trading day since the Full Moon

Share this post


Link to post
Share on other sites
What a nice word to use to describe the present.

 

Pronunciation: \ˈkän-ˌflü-ən(t)s, kən-ˈ\

Function: noun

Date: 15th century

 

1: a coming or flowing together, meeting, or gathering at one point <a happy confluence of weather and scenery>

2 a: the flowing together of two or more streams b: the place of meeting of two streams c: the combined stream formed by conjunction

 

Thanks for the definition Pixel8r! That's the first word that came to my mind when I was writing that.

Share this post


Link to post
Share on other sites
Interesting. Dec contract bounced off its May 06 highs and also straight off the trendline:

fssponxj3.gif

YES.

And the LOW was the full moon day, last Friday.

 

As I said late last week:

TECHNICALLY, A near perfect set-up - Why is no one here commenting on it??

. . .

If Oil has finished its A-wave down, and makes a good rally here, the Weekly break

above could be turned into a bullish "false break".

 

I felt a little "at sea", later that day, as it broke below the support level ($800) I had identified/

 

But now, with Gold back up, I am feeling considerably less shabby today

 

==

 

Gold: $813 ! and Oil is up several dollars too !

Share this post


Link to post
Share on other sites
YES.

And the LOW was the full moon day, last Friday.

I hadn't heard of the moon-phase influencing trading.

 

Although I have heard that the police and hospital accident & emergency departments can vouch for its significance in their lines of business (full moon = more trouble than usual).

 

Share this post


Link to post
Share on other sites
YES.

And the LOW was the full moon day, last Friday.

 

Time for a chorus of 'I See a Bad Moon Rising' then ----

 

Or is that just a shaggy werewolf story. :lol:

 

.

Share this post


Link to post
Share on other sites
I hadn't heard of the moon-phase influencing trading.

 

A large number of turning points take place on Full Moons, but it is not conclusive.

 

Share this post


Link to post
Share on other sites
I hadn't heard of the moon-phase influencing trading.

 

Although I have heard that the police and hospital accident & emergency departments can vouch for its significance in their lines of business (full moon = more trouble than usual).

 

Comedy clubs go all weird too.

Share this post


Link to post
Share on other sites

Can't find the original post about Paul Van Eeden saying gold was overvalued, but here is a recent interview

 

http://watch.bnn.ca/trading-day/august-200...2008/#clip84424

 

Bubb - u dismissed his reasoning - wonder if u could flesh that out a bit

 

He certainly looks quite smart just now - went neutral at 1000, nibbling sub 800, as beleives fair value = 760

Share this post


Link to post
Share on other sites
Can't find the original post about Paul Van Eeden saying gold was overvalued, but here is a recent interview

 

http://watch.bnn.ca/trading-day/august-200...2008/#clip84424

 

He certainly looks quite smart just now - went neutral at 1000, nibbling sub 800, as beleives fair value = 760

A very solid interview IMHO. Clearly we don't know how he performed his calculations and what assumptions/rates were used, but on that performance he's clearly a smart, lucid professional. One of the more credible investors / pundits out there in my view.

 

Very useful comments on juniors, I thought. Maybe you could get him on CWR CC?

Share this post


Link to post
Share on other sites

Great interview, thanks for sharing. Can't find his Cranberry Capital company on the internet. Know anything about it? Need to check out Altius Minerals.

 

Can't find the original post about Paul Van Eeden saying gold was overvalued, but here is a recent interview

 

http://watch.bnn.ca/trading-day/august-200...2008/#clip84424

 

Bubb - u dismissed his reasoning - wonder if u could flesh that out a bit

 

He certainly looks quite smart just now - went neutral at 1000, nibbling sub 800, as beleives fair value = 760

 

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

×