The Gold and Silver Thread

[Toro]

I believe that the precious metals markets are in distribution and are topping, at least in the short-term.

I began to liquidate my holdings today and will be completely out within the next day or two. I do not believe that this is the ultimate top but am stepping aside to let this play out.

 

[Toro]

Both gold and silver are getting whacked again today on news that China has raised bank reserve requirements for the fourth time in two months. I believe that the precious metals are topping here, and the next move is down.

 

[uscitizen]

Both gold and silver are getting whacked again today on news that China has raised bank reserve requirements for the fourth time in two months. I believe that the precious metals are topping here, and the next move is down.

Maybe, I have heard that before though.

 

[LordBrownTrout]

I don't mind the back and forth as long as it moves up, which it will continue to do. I'll sell at around 100 an ounce.

 

[Valerie]

Gold prices were extending post-market losses from Thursday after Bernanke said he expected the U.S. economy to grow between 3% and 4% in 2011, much better than expected. The positive news was a sledgehammer for gold.

If you read between the lines, this could mean that the Fed could stop or alter its $600 billion bond-buying program before it runs out in June which would limit the flow of extra money in the system. Investors had been buying gold as protection against this program which many expected would devalue the dollar and were buying gold as a safe place to preserve their wealth.

Another scarier option for gold would be the possibility that the Fed could hike key interest rates sometime this year. Other emerging-market countries have already been doing this to curb inflation, but developed nations have refrained because of high unemployment.

David Morgan, founder of Silver-Investor.com, says that gold prices will react negatively when interest rates are hiked severely or are very high. Small increases or modest rates won't be too much of a headwind for gold prices.

Nevertheless, gold prices like a negative real interest rate environment when rates are lower than inflation. If that dynamic reverses then the U.S. dollar would be worth more and gold would lose its appeal as a safe-haven asset.

Gold Prices Tank on Moves to Curb Inflation - Yahoo! Finance

 

[Valerie]

"Gold mining stocks, a risky but profitable way to buy gold, were sinking Friday. Gold stocks can lead gold prices on the way up and way down.

Morgan says the underlying equities can be a leading indicator for the gold price. "They're breaking down more than the actual gold and silver metals are and because of that I think we are going to see further weakness in the metals themselves."

Yamana Gold was 3.17% lower at $11.57 while Goldcorp was down 2.45% at $41.04. Other large gold stocks Agnico-Eagle and Eldorado Gold were trading at $69.54 and $17.26, respectively. "

 

[Toro]

The RSI for gold went below 35 today. There have been 15 separate occurrences since 2001 when this has happened, and in each case, gold was higher a year later by on average 13%. It was higher 14 times 5 trading days, 10 trading days and 3 months later. The only time when it was lower was during the teeth of the financial crisis in 2008.

The caveat is that if this really is the top in gold, then these statistics are bunk. It appears that gold is putting in a more formidable top here, unlike the other times it has corrected over the past decade. Also of worry is that gold has been going down even as the dollar has been falling. When the bull market in gold ultimately ends, people are going to get killed, so you have to be careful.

 

[KissMy]

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!!

Did investors really think that the fed was not going to continue their QEII program until June?

I will bet that QEIII will begin as soon as QEII ends.

 

[Mini 14]

The RSI for gold went below 35 today. There have been 15 separate occurrences since 2001 when this has happened, and in each case, gold was higher a year later by on average 13%. It was higher 14 times 5 trading days, 10 trading days and 3 months later. The only time when it was lower was during the teeth of the financial crisis in 2008.

The caveat is that if this really is the top in gold, then these statistics are bunk. It appears that gold is putting in a more formidable top here, unlike the other times it has corrected over the past decade. Also of worry is that gold has been going down even as the dollar has been falling. When the bull market in gold ultimately ends, people are going to get killed, so you have to be careful.

Gold FUTURES, maybe.

But not physical gold.

Anyone buying futures in metals is running a huge risk, while holding metals is far safer than putting money in the bank (and FAR more profitable).

I'm hoping all the banks fail. Then I'll be King of the World, Ma!

 

[Paulie]

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!!

Did investors really think that the fed was not going to continue their QEII program until June?

I will bet that QEIII will begin as soon as QEII ends.

Imagine if QEII doesn't work as intended, and the Fed just decides to stop the inflationary policy.

It would expose them as useless and irrelevant while they wasted trillions. They will continue to throw money at this until some kind of positive spin can be put on it, while they fool the country into thinking they have some kind of creative and comprehensive exit plan.

I'm actually surprised that Toro isn't seeing past the bullshit.

These aren't the same times that we were in throughout this past decade Toro. It's very possible that all bets are off at this point.

 

[Toro]

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!!

Did investors really think that the fed was not going to continue their QEII program until June?

I will bet that QEIII will begin as soon as QEII ends.

Gold was over-sold. We will probably get a bounce.

However, it still appears to be weak technically, and after the bounce, I expect lower lows.

 

[LordBrownTrout]

I'm holding on. This market is not good and there are no positive prospects that I see in the near future. I'm not a pessimist but I've never seen anything like this.

 

[Toro]

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!!

Did investors really think that the fed was not going to continue their QEII program until June?

I will bet that QEIII will begin as soon as QEII ends.

Imagine if QEII doesn't work as intended, and the Fed just decides to stop the inflationary policy.

It would expose them as useless and irrelevant while they wasted trillions. They will continue to throw money at this until some kind of positive spin can be put on it, while they fool the country into thinking they have some kind of creative and comprehensive exit plan.

I'm actually surprised that Toro isn't seeing past the bullshit.

These aren't the same times that we were in throughout this past decade Toro. It's very possible that all bets are off at this point.

I expect that gold will be higher at some future date.

But when gold falls, it will fall dramatically and spectacularly, and there will be a lot of blood on the floor. Gold is an investment, not a religion. Too many gold bugs don't make the distinction.

The technical formation for gold is unlike any we've seen since the bull market began. It has put in what appears to be formidable resistance.

 

[Paulie]

BANG!!! - Gold pops up $20 after the Fed's FOMC announcement.

WTF!!!

Did investors really think that the fed was not going to continue their QEII program until June?

I will bet that QEIII will begin as soon as QEII ends.

Imagine if QEII doesn't work as intended, and the Fed just decides to stop the inflationary policy.

It would expose them as useless and irrelevant while they wasted trillions. They will continue to throw money at this until some kind of positive spin can be put on it, while they fool the country into thinking they have some kind of creative and comprehensive exit plan.

I'm actually surprised that Toro isn't seeing past the bullshit.

These aren't the same times that we were in throughout this past decade Toro. It's very possible that all bets are off at this point.

I expect that gold will be higher at some future date.

But when gold falls, it will fall dramatically and spectacularly, and there will be a lot of blood on the floor. Gold is an investment, not a religion. Too many gold bugs don't make the distinction.

The technical formation for gold is unlike any we've seen since the bull market began. It has put in what appears to be formidable resistance.

Well I admittedly don't know a lot about technicals, but I would imagine that this gold situation would compare to a company that was profiting tons of money, but somehow the technicals were signaling resistance.

Yeah, maybe right now a good short play would work, but fundamentally it seems pretty bullish to me.

I think the smartest money knows what they need to see from the Fed before the plug is pulled. And it isn't any of that dog and pony shit they've tried using recently, either. Interest on reserves, discount rate tricks, manipulating treasury yields, etc.

I'm talking about some serious bank reserve extinguishment. Call me crazy, but I don't see that anywhere in the foreseeable future.

 

[Toro]

I'm not short gold or silver here. I was contemplating a short-term buy of gold today. But my short-term trades have sucked lately, so I passed.

 

[KissMy]

I'm not short gold or silver here. I was contemplating a short-term buy of gold today. But my short-term trades have sucked lately, so I passed.

I almost did the same thing but by the time I saw the news & price it had already moved $20. It only moved $2 more for a total of $22 bounce after the FOMC. I would have only made $2. I decided to wait to see if this was a bounce or a trend that will continue tomorrow.

All the commodities have been declining for weeks but today they all jumped up. Gold was up against every currency today. The big decline in the Baltic Dry Shipping Index is what has me worried about all commodities because they are not moving or being consumed.

 

[KissMy]

Gold is trending down again this morning. We should get a pop from the jump in jobless rate just announced.

 

[Toro]

I'm not short gold or silver here. I was contemplating a short-term buy of gold today. But my short-term trades have sucked lately, so I passed.

I almost did the same thing but by the time I saw the news & price it had already moved $20. It only moved $2 more for a total of $22 bounce after the FOMC. I would have only made $2. I decided to wait to see if this was a bounce or a trend that will continue tomorrow.

All the commodities have been declining for weeks but today they all jumped up. Gold was up against every currency today. The big decline in the Baltic Dry Shipping Index is what has me worried about all commodities because they are not moving or being consumed.

China has been trying to slow it's economy. The Shanghai index is down 16% from the highs, though it may be putting in a bottom here.

What I think is happening is that investors are rotating out of commodities and bonds and into stocks. For example, West Texas oil is down 5% in January and natural gas is flat but oil equities are up 5%.

 

[KissMy]

I'm not short gold or silver here. I was contemplating a short-term buy of gold today. But my short-term trades have sucked lately, so I passed.

I almost did the same thing but by the time I saw the news & price it had already moved $20. It only moved $2 more for a total of $22 bounce after the FOMC. I would have only made $2. I decided to wait to see if this was a bounce or a trend that will continue tomorrow.

All the commodities have been declining for weeks but today they all jumped up. Gold was up against every currency today. The big decline in the Baltic Dry Shipping Index is what has me worried about all commodities because they are not moving or being consumed.

China has been trying to slow it's economy. The Shanghai index is down 16% from the highs, though it may be putting in a bottom here.

What I think is happening is that investors are rotating out of commodities and bonds and into stocks. For example, West Texas oil is down 5% in January and natural gas is flat but oil equities are up 5%.

Yes that is what has been going on all month. The thing I am looking for is a big snap back rally. But if the employed workforce is truly increasing then the trend very well could be down for some time until people figure out government still can't balance the debt even with everyone working.

 

[KissMy]

After studying the unadjusted employment trend I decided to sell 15 more gold Buffalo coins at $1388 & 50 silver eagle coins at $29.45

Now I am down to 50 gold Buffalo coins & 150 silver eagle coins.