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01-15-2011, 11:02 AM #1726
Up or Down.
I did see -7% recently, I survived that, but this could be a downtrend that lasts some time.* Or not.
I lived with those falls, but facing the possibility of a massive fall back to 1200 as seen last Aug, and heading south at a rate of knots I finally bailed out.
Having been greedy (or trying to recoup earlier losses too quickly) I had up to 10 long positions open in each. When selling I at first tried to decide if to sell the recent buys with the smaller loss (that I timed for most short lived retracements, only for it to fall further suddenly again) or to sell those held for longer bought near the peaks over 1400 or the even earlier ones still showing some profit.
In the end I guess it makes absolutely no difference which ones you sell. They all drop as much per pip.
I note silver has dropped 8.8% from Jan 4 high, and would drop 52% if it fell to 2010 low.
Gold has dropped 4.28% from the high, and would drop by 18.3% if it fell to 2010 low. (Or even the 2000 - 2007 level) One would need deep pockets to keep that as a core holding.
When India alone buys 2 tons of the stuff each day, I do wonder if there is scope for some price manipulation by the hedgies or someone, or is it a bubble that can go pop?
Now I cant keep a core holding AND go short as Greg did. Unless I do one with Silver and the other with Gold. So Greg, which way next?
I think a whole load of folks would be interested before rather than afterwards.................
* After penning that, just read Franklin's "Now call to mind that earlier this week gold broke that old $1,362 low and touched $1,353. Yesterday it rallied, but today returned to close beneath the old low. This strongly suggests that gold will move lower, say, to $1,330 or $1,300.00." And I'd also noted this effect: "'Tis worth noting and pondering that stocks have diverged from their sometime movement in the same direction with silver and gold. I'm not sure what that means, but it seems like something to wonder about."
Thanks Ski, that's pics so much better. Will you marry me? (If my wife lets me)
01-15-2011, 12:57 PM #1727
Gold isn't a vehicle which you should traditionally trade. Flip flopping long or short will just destroy your account. If you want to trade it you buy dips and sell the rips and you only buy which you can't be stopped out on.
Originally Posted by byways
Gold is the most difficult market to trade, the very best and biggest players play this market respectfully speaking you'll get killed trying to trade it like you would the euro or gbp.
if you must use stops use them to profit out.
Decide if Gold is going to make a new high this year or next year....if it is your sitting looking @ $70/oz profit right now.
IF you MUST trade gold intraday you are going up against some pretty big opponents. You should know the times which gold bottoms and tops. For instance the P.M (10am EST) fix will almost always put in a low for the day.
Asian trading is almost ALWAYS reversed in NY trading, meaning important gold price happens 8:20-1:30pm EST, virtually ALWAYS. Fade the asian gaps.
Gold tops are almost always double 60min bars in asian trading @ new highs.
Large buyers scale in buys during the NY session, so bottoms during heavy selling will be successively weaker sweeps down on the 10min charts.
Chart patterns are created to be violated by the market in gold. Any bullish are bearish patterns should be faded.
Daily/Weeky Gold tops are ALWAYS exhaustion spikes.
Bottoms are virtually always reverse H&S bottoms as seen on the 120min and sometimes the 480min charts.
Don't buy or sell gold sunday night no matter what it's doing.
Hope this helps.
One more trick.
Trade 1 lot size until you've traded 1 lot size in profit. Then trade two. That's how you KNOW you're good a trading a vehicle, no leverage hocus pocus lottery.
So trade 10oz until you've traded 10oz worth of Gold, then trade 20oz until you've traded 20oz in profit...then 40oz etc etc.
See if you can do $50/week...that's 6months each level.
I should add...for me trading gold as been the best education. Because it is the most difficult market to play in my opinion it's allowed me to trade other markets with virtual ease. Gold still kicks my ass. This latest bout has cost me 30k in realized losses and 50k in unrealized losses.
Trading the 30 year bond, Euro, USD/CAD, grains or metals is like shooting fish in barrel compared to Gold. Actually last month my trading activities funded my Gold love affair. So beware...you can play with it but it is very very very difficult to master.
Last edited by speculator84; 01-15-2011 at 02:04 PM.
01-15-2011, 01:12 PM #1728
Like most analyst out talking about Gold I believe 1700 can be achieved this year. The coming months will be the most volatile for gold heading into June when the coming muni defaults will be all the rage. $2500 is not out of the question.
After that i'll be taking a year break from Gold.
01-15-2011, 01:43 PM #1729
Here's a look at Gold today:
I give it a 70% chance the bottom is in already with a 30% of a downside break of 1352 (GC G1 Feb Contract).
A break of 1352 would bring 1329 and 1315 into focus. A $40 move in Gold is a DAILY thing so you can't stomach that you're in trouble.
And remember economic conditions are not improving, states and municipalities are bankrupt.
In Wiemar Germany Inflation was tamed while they were monitizing debt and then suddenly it exploded. In the 70s it was a La nina which kicked off food inflation and other inflationary events.
Food prices are the spark which will launch us into a tailspin and we are seeing it now.................a dictator was just dethroned because of food prices....it will not stop there.
01-15-2011, 06:02 PM #1730
Thats when you hedge your core holding. Place a hedge sell order on your longs to ensure you don't drain too much equity (and make a profit, given gold goes up again).
Originally Posted by byways
Stuff like this usually suggests a bottom coming along sooner rather than later. When you get a lot of sell calls, there will be a day when gold goes up 1-2% and a lot of shorts get squeezed sending gold way higher.
Originally Posted by byways
01-16-2011, 11:08 AM #1731
Thanks for these very considered replies Speculator, which I'm sure others will also find useful. I am not disagreeing with anything you have said, but my thoughts are these for comments on.
I am ok with the swings, I have found Silver harder than Gold to deal with, have made some great gains, as well as even greater losses, it clearly is getting more volatile (since Oct 5th) than it has been for a while. I hate getting stopped out as that is a dead loss, and it has so often kissed the stop level and whizzed up again, so have often not had stops, which on the whole has been beneficial. I don't flip flop, but did (and am) short on Silver, and may try that until the direction ahead is clearer. I have had some success with simultaneous long-short positions on the Dow FTSE or German indexes, and if it goes against me, I buy more, unless I think it really is a very long run and eventually sell out, but that eats up all the gains on the one going t'other way. When it oscillating I set a but at what I expect is a low, and a limit at where I am sure it will get to, and that has had some success. As you say, Gold is different.
I have been buying on the dips, only the dips got lower! I do sell out a part, set stops at different levels (when I use them). I divide the holdings into some that I set a Target and sell regardless, others as soon as a fair profit has built up set a fairly short stop, and others hold without stops.
So I need stops in case it does go south big time. However do I (we?) buy now just above it's Dec 7th low of 1357 and hope, or wait till it gets above say 1395 to be sure it is heading North? Alternatively see if it drops through the 1320, of Oct 22 & 28th. If it does, it could drop a lot more. Or that could be the last buying chance of a lifetime!
I'm thinking now of a stop at under 1350 (Jan 7 low 1351) , and some buys when it exceeds 1380, and another at 1395. Dumb? But then stops on those buys?
I never buy a multiple, and sometimes sell only a part of a holding to lock in some gain or reduce loss before selling all of a position.
I am also fairly confident it will continue up. Most commentators hold that view, but some big names differ. I just look at the 36year chart and think, 'eck it looks a bit like 1980 Gold Price History
Even the Dec 2009 sell of fell more than this little hiccup, only that had a sharp peak, this is much more rounded - should anything be read into that!
A straight line has been followed from the end of 2008, which says it should be around 1400 now. The sell off from 1420 highs has been overdone, and I agree $1700 or more by the fall is not out of the question.
01-16-2011, 12:12 PM #1732
Hi chaps , I've been lurking in the background
And following the posts Excellent!
Ive been longing gold , 1st at 1409
Then doubled up at 1377. I still have plenty
Funds left , no stops placed , looking to add
But at what level is the million $?
My vehicle of trading is via a spread betting account
With finspreads . Ime thinking of adding now at 1360
As my contract expiry is 27th jan .
Not sure it will bounce by then
Maybe I should take the hit . But a wee
Inckling telling me stay with it !
01-16-2011, 12:42 PM #1733
The gold bulls are forgetting something very important. Gold made a big move down Friday primarily because of the actions of the People's Bank of China raising reserve requirements . They are using every tool available to slow growth and inflation before it spirals even further out of control and this is going to impact commodity prices in a big way. The PBOC is as important a player in the global financial markets as the US Fed, perhaps even more so in some ways, and the markets may not have fully discounted their actions. Another 50 bp rate hike from them and you could easily see gold below $1300.
01-16-2011, 02:22 PM #1734
As a Gold bull the new normal I am expecting is for interest rates to rise world wide as they track the inflation created by Global Q.E.
Originally Posted by Mary R
This is evident on euro bonds and US Treasuries. I fully expect all nations to raise interest rates. High interets rates did not stop the inflation train in Zimbabwe or Wiemar Germany and it will not happen now.
A good study was done by zero hedge which found that interest rates have absolutely no correlation with the price of Gold, except in one extreme circumstance in 1979-80 when gold went up exponentially. Interest rates also went up exponentially.
The key is real rates. Until real rates are broken Gold will continue to rise.
Ask the people world wide suffering from 10-20% monthy? Food price increases if a 50 bps in china is going to help them out. It is not and it will get out of hand in China, it will probably be the reason why they drop the fixed exchange rate.
The only thing which I am somewhat concerned is the defaulting of munis at the moment sparking a 2008 style collapse, but even then those defaults will be with a collapsing USD. The gold price has much higher to go in my opinion and not much can stop that. Technically we have no exhaustion, offside chance silver is a bit ahead of itself.
A good report was that of Dan N on jsmineset....the hedge funds have pretty much bailed down to almost no holdings in the gold market since the new year and we are still standing quite strong, which is pretty fascinating....they could be bag holders when this thing really takes off as they chase it higher.
Last edited by speculator84; 01-16-2011 at 02:32 PM.
01-16-2011, 02:35 PM #1735
Q.E 2 was announced @ $1327/oz. I have a VERY VERY hard time believing gold will go below that price.
01-16-2011, 05:11 PM #1736
Don't count on muni bond defaults collapsing the dollar. When people liquidate muni bonds the money goes into money market funds and short treasuries which is dollar bullish. and the Chinese rate hikes will impact gold prices this year, count on it.
Originally Posted by speculator84
01-16-2011, 07:48 PM #1737
Don't blink or you'll miss the dollar rally....
Originally Posted by Mary R
People will not buy munis and they will dump the munis....then the Fed will QE 3.0 the munis.
Treasuries will collapse, interest rates will be flying and the dollar will be collapsing.
The money will run away from anything USD related it will go straight into commodities. You can count on it.
What your saying is absurd........it's like saying ..."Greece and Ireland are going to default but don't count on the Euro from collapsing! Buy the euro!!!"
Let me rephrase that as well...the dollar may trade @ 80 forever but commodities will be double from here.
Last edited by speculator84; 01-16-2011 at 07:57 PM.
01-17-2011, 12:58 AM #1738
Gold v India 30
Gold and India 30 move the same way at about the same time, qauntum varies a bit.
India is same level now as on Sept 13. Gold was then at 1245 ish. Is that relevant?
p.s. India buys a significant c700 tons per year, and only 365,000 tons have been brought above ground in the last 2000 years or so.
Last edited by byways; 01-17-2011 at 01:02 AM.
01-17-2011, 03:38 AM #1739
too many few posts on Crude Oil
I check this forum more than once a day, but all I see is GOLD posts or SILVER posts.
You guys should post more about Crude Oil since I follow it but I'm no expert so I'm looking for your expert opinions to get an idea on what to do.
Is there any other forum or website you recommend me to follow? Thanks
01-17-2011, 06:12 AM #1740
Oil to Continue its Journey to 95-100 zone
Originally Posted by and.baggio
I make no claims to be an expert but in response to your concerns re the lack of posts re crude oil, I suggest you drill a little deeper in this forum. Personally I see oil heading to at least the 96 level before any major fall. The floor of 86 should hold until the 96 level is reached. Check on page 3 of the forum and lower and you will see posts by myself and Ski-Bunny etal re crude oil. I hope this helps.