Bobsta

BTW... As you might see from the above quotes, I've changed my name (to protect the innocent).

Under $11.50 now.

My bowels are loosening up nicely ready for total collapse once we breach $11.

Silver Sammy reckons we'll go to $4. What would that do to your innards?

Oils gone below $100!

Cue OPEC.

IT WILL...

 

When investors assess the real implications of the actions of the Govt, the Fed and the Treasury we expect the US dollar to resume its long term downward trend, while in contrast, we expect commodities and gold in particular, to recovery strongly.

Who's "we" DrBubb?

Maybe the Russians will save us. Crash2006 over at HPC seems to think so...

i've just heard russia has started to sell all its dollars.

LOL!

Looks like the $775-$780 is crucial level break that and maybe we test the old may 06 high

 

UPDATE: Looks like we touched the 777 level again, and bounced who knows could just be a retest before a rally.

I listened to Friday's Financial Sense podcast on the way into London this morning (which I thoroughly recommend, BTW).

I can't remember which guest mentioned it, but $775 was cited as an important level. Break below it and it signals the market is ignoring intervention and taking a short-term deflationary view (potentially until around year end). Go above it and take $850, and the intervention is being priced in and the market has realised we're in inflationary mode.

I'm watching from the sidelines and staying clear of Silver for now - this is going to be interesting.

I'm probably just reading way too much into very early trading. Many will be waiting for the reaction in Europe and especially USA before commiting to big positions.

I know what you mean. Sometimes the markets are just plain confusing.

- There'll be a change in UK interest rates and the pound won't move. OK - so the market had the move priced in. Fair enough - these traders are a savvy bunch.

- But then there'll be an event like last weekend where Alistair Darling admits what anyone with half a brain already knew and BOOMF, GBP falls off a cliff.

- Is it a big surprise that Fannie and Freddie would end up this way? I can't really tell from what the market's doing.

- And why GBP so upbeat this evening? I suspect it just got over-sold last week.

Spot price feeds seem to be a bit knackered. IG has only just posted an update, so the chart looks like this:

The futures price feeds seem OK though. Dec Silver did this (which is where I got the gap from):

Not impressed by the fall-back though.

I think you will have to be extremely quick - almost bound to gap up, I would have thought.

G&S doing very nicely.

And yep, they both gapped up. Silver gapped up 40 cents on open.

Conversely, GBP is rallying meaning gains in GBP won't be so good. And let's face it, we're only recovering part of what was lost on Friday, so not really time to get the rockets out just yet.

Do you need someone to tell you what to do, or do you need to do fundamental research on your own?

That's a very valid point GF!

I try to do as much research as I can but often I find I can't see the wood for the trees. There's simply so much info out there, it's impossible for me to do my day job, have a home life and get round to reading and digesting everything that I need to try to work out what's going on right now.

I guess that's why I enjoy GEI (and previously enjoyed HPC) because effectively you become part of a whole team of researchers, all reporting back concentrated, condensed, relevant findings. That's also why I welcome the contrarian views on the various PM threads.

I fully appreciate that there's a core of posters who contribute far more to the community than I ever do - and I'm very thankful to them.

What I want to be sure of is that as a team we're all not blindly following the wrong path. As I think we all agree, double-checking our logic on a daily and weekly basis is important. The recent CWR podcasts resulted in Dominic questioning/alterning his views on inflation/deflation - and that's healthy. What I want to be sure is that I understand (or at least get some pointers on where to go read up myself) why views are changing, and indeed if they are changing.

The recent posts on this thread made me suddenly think "Hold on a sec, has there been a significant change in the community's view on Silver that I've missed?" and so I asked the question.

Just to clarify, I talk of "the community" but I appreciate we're not running some kinda kibbutz here - it just seemed the easiest way to phrase my point

My research (and I do a lot of it) makes it much easier for me to make decisions. For instance I think that all that retail price deflation talk is utter bu11cr@p, and that oil will soon reverse its trend because of supply problems. The PM market is manipulated unlike any other market in the world. And manipulation never works out for long. Why can't I find any silver coins below $17-$18?? It's a joke.

I appreciate that, and FWIW it's clear that you do shed-loads of research - and I think you always make your views clear GF.

I'm of a similar view and right now would say I'm more confident in Oil rising up from a low of ~$90 than I am of Silver. But since I have no Oil holdings (apart from half a tank of heating oil in my garden) that's not really helping me protect my wealth. I need to firm up my opinions on Silver. Fast. Friday shocked me.

I'll summarise:

- Appreciate all the research from everyone

- Try to do my own too

- Wondering if there's generally been a shift in expectations for Silver, these past weeks

EDITed to include:

As for all the comments that we'll be OK in the long term with PMs - if deflation is on its way, it'll be around for longer than my investment time horizon, so I'll be down on all my PM investments at the time when I might want to swap some of them back into fiat (3-5 years probably).

DITTO! I will be looking to potentially buy a house in 2.5-4yrs (depending on how this all pans out). I have personal circumstances that mean whether or not that's an optimal time to buy, it is something I may need to do. I appreciate HPs are falling and previously wasn't confident at leaving cash in index-linked savings accounts. But honestly, I'd argue that a significant concensus on GEI (and research linked to those views) seems to point to that now being a credible option. Does GBP have further (down) to go? Probably. So transfer it all to EUR and stick it in German gov't bonds (as per cgnao's advice)? ... Maybe, but what if EUR is the next currency to fall off the cliff?

Rock < > Hard-place

Difference between trades and long-term investment

Sorry, I don't really understand that point.

Are you saying that on 1st July you viewed Silver as a good short-term long trade, but as an investment over the next two years you don't?

Or are you saying that with a long-term view, buying on 1st July wasn't such a bad idea, as in the long term you expect it to go higher? If so, I don't quite understand why if you fully expect it to continue falling in the medium term (6 months? 12 months?) you could take this position. Surely it's better to jump out now and back in later?

I have a slight problem with the differentiation between trades and investment when it comes to PMs (which provide no yield). If I invest in something and I then take a view that it's not likely to perform well, I'll sell it. Does that make that "trading" rather than "investment"?

I appreciate that no-one can accurately call tops and bottoms and am certainly not looking for this board to be a free tipster service... But as I said before, I sense in this case that people aren't saying "Don't worry, this is just a minor pull-back before a move upwards" - there is some very real talk of silver performing pooly (as an investment and a trade) for the forseeable future.

And once again, I'd point out that I would *never* lambast anyone for stating an opinion that proves to be incorrect. I'm simply trying to understand whether folks' views have changed or not.

In short, I need to help work out in my mind whether to sell all my Silver and look to re-buy in 1/2/3/6/9/12 months.. Or whether to view the current situation as a buying opportunity. Right now there seems to be a massive divergence in views - far greater than I've seen previously.

Hold on folks... have things really changed so much in just two months?!!

It looks like it's ready to explode upwards

Agreed.

MA's are lined up perfect.

got to give you a bit of thanks here Cuthbert, your moneyweek newsletter a couple of weeks ago showing how silver was bouncing off of $16.50 persuaded me to get in around $16.80. up a nice little bit in my SB account.

... and now just 66 days later:

According to Hoye and I think he is right, silver will outperform during an inflationary credit expansion , but it will be one of the worst performing assets during a deflationary credit contraction. We are in a credit contraction now.

Aren't we going to be in a credit contraction for years?

The concencus opinion seems to be at least another year or two.

Indeed, I would not be a bit surprised to see silver at around 2004 levels by the end of the year ($6ish).

Yes, actually. Just as I envisaged gold pulling back a long way as well. Silver going back to $6 would be very good indeed. A perfect opportunity to purchase more.

I operate in terms of decades and generations only. I buy gold now and would buy it at $100. Price is virtually irrelevant.

Now, I'm old enough and stupid enough to be responsible for my own decisions. But there appears to be complete 180 degree turn going on by some folks here.

Saying something's a good investment at $17, and it falling to $13 isn't necessarily a problem if we believe the fundamentals are still in place and the fall is just a "minor setback".

If the view is that the fundamentals have changed and it is more likely to be heading lower than higher in the medium term (the next 12 months) then that really is a monumental shift IMHO.

A number of posters were converting gold to silver feeling silver was likely to move up quicker than gold.

However, in the recent CWR interviews there was mention of "Gold is money - but Silver is just an industrial metal" ... which would certainly not be positive for silver.

I just get the impression that there's a lot of confusion and head-scratching going on out there. Talk is cheap folks - and I think this needs to be acknowledged when posting. Saying "Wahey, I loaded up at $20, bought more at $16 and want it to go to $6" makes no sense whatsoever to me.

Please note: this isn't a personal attack on any specific posters - I think it's something many of us are guilty of at times. I think there needs to be some acknowledgment that some significant money is on the table for a lot of folks here and real money is being lost! The fact that the pounds I'm losing are worth less than they were 2 months ago doesn't actually cheer me up that much.

and the volume of the selloff is huge, this is enough for silver to be under 12.50 for quiet a while. If it goes to 12.45 on asia next week, i will short it. Next support should be 10.80 i guess.

OK, let me ask some dumb questions..

1) The volume is huge - could that not mean this is one single seller? e.g. hedge fund liquidating?

2) If a large volume was sold short, surely it needs to be bought back at some point - no?

It's nice to see Gold showing some strength while stocks are so weak.

That's how it supposed to work, especially in September

Indeed. But what's suddenly gone wrong with Silver?

Someone liquidating a huge long position? Friday blues? Makes no sense given Gold's resilience.

It was down to $12.24 just now, but has recovered five cents.

It was over $13.10 earlier in the day... I had a limit order trip to sell some futures at $13.17... then bought back at $12.80. Feeling like a t1t now!!

The movement's insane. Gold is having a very mild day in comparison!

For catflap and others - please do NOT take any of the above as being reliable information, advice, or sane comments. I just posted my current guestimate for this month as I've nothing better to do for a while just now, and so you can all point and laugh at me in 1 month if/when my predictions don't come true

Darn! I wish you hadn't said that. I wasn't going to take any action based on your earlier post (that'd be a bit nuts, frankly).... But it was sure as hell making me feel better!

I am trying to work out some rough numbers in relation to my question. does anyone know what the exchange rate was between the dollar and pound on the 4th of August?

Ahem. I think I agree with wrongmove - that sort of data is available pretty much anywhere on the net.

Anyway, save yourself the trouble and just plot a gold chart in GBP. There's an easy one at Bullionvault - http://www.bullionvault.com/gold-price-chart.do

(you'll need to pick GBP and your time period)

Or a more complex one at StockCharts - http://stockcharts.com/charts/gallery.html...;GOLD:$XBP

Genuine question folks

 

given that the pound is falling againts the dollar...

 

How much has gold fallen in value in uk pounds?

 

Is it as much as seems to be the case in terms of the price of gold in dollars?

 

Or, has the fall in the price of gold in pounds been less than would at first appear in dollar terms?

See Frizzers' latest MoneyWeek article - bottom chart:

nice silver setup here

British Bulls seem to agree...

A bullish pattern has developed and a BUY-IF alert is issued today. The task is now to confirm the validity of this bullish pattern. We will guide you through this process but the Prima Donna of this game is nobody but you. First you must do your homework. A good starting point may be to keep an eye on after-hours and futures trading to get preliminary hints about the direction of the market. Related news, events, economic data, and the world stock markets should also be closely followed prior to confirmation session.

 

There are three possible cases of confirmation. You have to follow the next session carefully to check if these cases will hold or not:

 

The market opens with an upward gap, signaling a bullish sentiment in the first case. Your benchmark will be the opening price. If the prices stay over the benchmark, go long. Any white candlestick with an upward gap is a valid confirmation criterion.

 

In the second case, the market opens at a level, equal to or below the previous day’s close. The benchmark is that closing price. If prices during the session stay over the benchmark, go long. Any white candlestick closing above the previous day’s close is the second confirmation criterion.

 

If, however, in both cases, the prices during the session start coming below the benchmark, avoid buying. Sell if you feel a definite tendency in prices to close the day below the benchmark.

 

The third case of confirmation is rarely observed. The market opens with a big downward gap suggesting a very bearish day, and the day ends with a long white candlestick, but still closing below the previous day’s close. However, such a day satisfies the third confirmation criterion and in this case the closing price of the long white candlestick will be taken as the price of confirmation.

 

If one of the three confirmation criteria is not fulfilled, or in case of a black candlestick or a doji on the confirmation day, the BUY-IF alert remains valid, however without confirmation and the three confirmation criteria are then sought in the following day. The only exception is the long black candlestick. Any long black candlestick following a BUY-IF alert makes it (the signal) void and invalid.

 

We do not suggest any new short positions given the bullish alert. The short sellers should consider covering their positions if the market confirms the BUY-IF signal. Otherwise, existing short positions should be carried.

Thats what I meant by "I expect gold to amplify the dollars fall in gains", but we wont necessarily get the same thing if sterling bounces and the dollar does nothing.

The way I look at things, I want the pound to bounce purely because it's so depressing to see my hard-earned cash wasting away.

I don't intend trading gold in relation to GBP movements. My gold holdings are only a proportion of my savings and you can bet that whatever action you take it'll go the other way.

IMHO significant Sterling appreciation isn't on the cards for a good few months and cashing in and out of gold on that basis isn't worthwhile. If you want to trade FX then trade it - but there are far more efficient methods than paying BV/physical dealing charges.

Gold is down about $20 in the last 24 hrs. In what way is this positive?

With my optimist hat on, gold was UP nearly $20 from 4hrs previous (when I made my original post).

Look at (in particular) Silver's performance during the all-important New York trading session today:

Incidentally, British Bulls are listing a WAIT on both gold and silver. I know I was somewhat skeptical last week but I have to admit that's quite an impressive performance:

Silver: Our system posted a WAIT today. The previous SELL recommendation was made on 29.08.2008 (4) days ago, when the stock price was 1,365.2500. Since then PHAG has fallen -7.23% .

 

Gold: Our system posted a WAIT today. The previous SELL recommendation was made on 27.08.2008 (6) days ago, when the stock price was 8,226.0000. Since then PHAU has fallen -3.46%.

It'll be interesting to see what they make of tomorrow's action.

I need help. I loaded up on LSIL (leveraged silver) at around $32 a few months ago - curently at 17ish.

I am tempted to not monitor movements for 3 months and look again in December - this is too much to cope with. Anyone else had enough of this?

Commiserations! I can appreciate your pain (depending on what "loaded up" means to you - hopefully you've not lost the value of a house)...

Today's action seems quite positive today... but I'd invite others with more experience to provide their input. Bubb and Cuthbert in particular - is this the bottom you were looking for?

As an aside, I listened to last October's CWR on the train home tonight.... some of Paul Van Eeden's comments got me spooked... paraphrasing: "Whilst governments and central banks are using inflation to avoid recession, I'll hold Gold. But if this changes, and efforts to avoid recession begin to look like they're not working, it will be time to reconsider"

Calling the bottom?

Nah. I can hope. But I fear I'd be wrong!

I'm afraid it looks as if we are going to get a retest of the lows.

 

If they hold that will set up alovely W bottom.

Silver at $12.83 ... blimey. Very tempting, even with the pound on the floor.

<MC Hammer>

STOP! Shopping time!</MC Hammer>

BTW, are we going to have a new September thread (Steve / Dr ?

SELL recommendation from British Bulls ... let's see what happens on open this evening.