dopamine

There're loads of comments around from PM bulls at the moment. Many of them seem to me to be a direct result of the cognitive dissonance engendered by gold and silver's decisive breaches of key supports. Unfortunately I'm resolving my dissonance at the moment by retreating to a pessimistic position (this is my default). I simply asked myself how I would behave if another one of my assets was demonstrating similar performance. The answer is that I would be losing faith in its ability to provide returns over anything except the long term (3-5 years+) and as such it would have become speculative (since it is hard to predict the influence of events on most assets so far into the future). This is fine for me since I still have a strong focus on PM fundamentals in my mind. Over the medium - long term I think that they appreciate in fiat terms - it's just that losing the innocent belief that the dollar is imminenty about to collapse means that I'm not hopeful for the large increases in my purchasing power that I was hoping for over the next year or so. So my greed, and previously misplaced certainty has been frustrated - I need to deal with it. Anyone else doing the psychological tango like this at the moment?

Snap - wanted to buy at around about 16 but didn't have time to ring my broker. Will now wait to see if it holds over 17 for a few days - strong support at around 17 was what preceded the last big breakout if I remember rightly. We've nearly had a 'dollar day' today - first for quite a while, so am always anxious about buying around one of these little spikes.

good god! does anyone have an understandable idea as to what this may mean for spot gold? some links i dug up: http://www.dailyreckoning.co.uk/gold-inves...ce-of-gold.html (pretty bizarre) http://www.aci.net/kalliste/Gold3.htm (easier to understand) I would tentatively say that it seems to me that these rates suggest huge short pressure, given that with negative lease rates people are in effect paying you to take gold off their hands.

manipulation or market ambivalence? Ambivalence precedes moves up or down, in life as in financial markets.

Yes, I was worried this has been a dead cat bounce. No fancy chart analysis for me - I simply felt it was going back up too quickly for my liking, so I held off buying any more and didn't have the confidence to do some short term trading. The volatility is crazy, even for silver. FWIW I think that it needs to maintain support above $18 for a while before it makes a decent move upward again. It does seem that someone really doesn't want it to break above $19 again. Also interesting are all the internet stories/rumours about physical shortage and how these presage a major movement. Following silver seems more like crystal ball gazing every day. The silver bulls are even more driven than goldbugs, so temperate analysis seems hard to come by.

my point exactly

yes, and i don't mind losing some of the upside if I can be more confident that there isn't another correction on the cards for a while (particularly in silver).

Silver's the most interesting story here. Ended at $16.70. Even with its notorious volatility, I was suprised to see it go under $18, let alone $17.

I have my own personal rule for markets. When I buy into a market, it corrects.

the volatility worked!

Yes, I think I get the message - hold assets rather than promises to pay. My problem is that the only real asset I'm interested in holding is property and I don't have the guts to put a 50% deposit sized chunk of cash into physical gold/silver. Give me 10-20% off property and I'd jump in there, crash or no crash, since holding a property asset with manageable debt at 15% beats holding cash evey time for me. I see my PM investments as insurance for my fiat rather than 'wealth'. This position, of course, may be calamitous for me if I have underinsured.

Yes I am occasionally drawn to increasing physical (have a very small amount at the moment),but am concerned re: liquidating quickly if necessary. Of course ETFs are an alternative but with the current situation I am minded to sell my ETF holdings in case of further system failures, rather than add to them. I have gold mining shares as well, but these are vulnerable too over the next 6-12 months IMO. I hold a lot of cash after STR and will need this to buy a house, so being exposed to a sudden large correction in PMs while holding a lot of physical would potentially wipe me out. Bugger.

Thanks for that. I get his emails and apart from his rabid millennarian christianity he does talk a lot of sense. In fact, it is those arguments that got me into silver. Problem is I always end up moving stops because of my over cautious nature, particularly when I see lots of red.

There's speculation that the fed will cut no more than 0.5 in order to bolster the dollar, and that the Sunday 0.25 cut in discount rate was the sweetener. No idea myself in current conditions

With my fairly naive mind, I'm amazed that we are seeing a dow bounce and commodity sell off today. I feel I've been smartly put in my place by the big boys. took a big hit today on silver- stopped out and down £2k (wiped out gains basically). Arrogantly thought we'd seen the last of sub $20 fluctuations. Now my natural caution is raising its head and I wonder whether I should've just stuck with gold, which has been resistant to the sell off and is climbing again as we speak. I know, I know, long term view and all that, but I have a reward dependent, harm avoidant personality and days like this bring out the blubbing child in me.

Thanks for the replies on this. Frizzers you're right of course re DMA - the thing is (and this connects to Bobsta's point on being sure about being right), I have to an extent 'bought' the talk about short positions in silver and think it's possible that we may see an unpredictable spike in the price, dollars in magnitude. I just can't envisage ag hitting $18 again for a long time, and that is where I'd be placing a stop, although I'd be grateful for a contrary point of view. Bobsta I think you and I have adopted almost the same stategy up to now, and I identify with the point about it affecting your job checking on prices all the time - that's why I'd planned on taking a larger position with a lower stop, and I think I've trained myself to be unemotional about being a few K down. I'm also happy with my plan to crossover my stop sell order with my stoploss - I may sacrifice a few K of profit that way but will have more peace of mind (e.g. sell order at ag=1850, stop at 1800, given that if ag falls that much I think it would be going against trend). Of course I'd have to use 2 different firms to do this. Basically I see my downside risk as being about £10K (which would, admittedly, gut me), but the more I read about the disaster unfolding I see the upside potential as being worth about £20K with POS=$25, and £45K if POS gets to $30, which I see as quite possible. Again, the argument re: short positions is what makes me think this. Of course, the alternative is spreadbetting gold, but it seems to me that in order to make a decent amount, you'd have to set stops very low (e.g. at £50 per point), because even though silver is more volatile than gold, the system of 0.5 = 1 point makes me feel more comfortable with taking a large position e.g. gold -10% = 1000 points, silver - 10% = 420 points. thanks again for taking time over the feedback guys - would be interested in following people's experiences

sorry - all greek to me. At a guess.....god knows I should probably be worrying about it, though.

CGNAO writing leaders for the daily mail next?

OK I'm not sure whether this should go into one of the other threads, but here goes: It's pretty clear to me now that fiat is slipping badly and that the pound in particular is vulnerable (after the dollar). Everyone here does not need convincing re: the merits of PM as a hedge against weakening fiat value (which is why presumably we're not all raving about forex as a way of hedging positions.) My motivation is not holding value when paper becomes worthless a la weimar, but in protecting my paper purchasing power in the coming bernanke stagflation (I still think it's possible that we could deflate after this period). Hence I use ETFs and spreadbetting rather than buying physical (although I do have a small physical position, and hold PM equities in ML GandG). I've been following PM movements for 2 years now and wish I'd had the courage of my convictions sooner than this. I've been making reasonable sums from spreadbetting, mainly to get the practice - starting from a very small position I've quadrupled my money, but have 'lost' a good few £ on downswings in the process. I'm now considering taking a large position (for me) in silver at £25 per point (1 point = 0.5c, i.e. I make £5K if silver goes up by a dollar). Clearly with such a large position I need to be mindful of stops, not wanting to stop out too soon. It also seems futile to chase stop losses around the price given that silver can easily swing around 50-80c + per day. I'm thinking of a stop at just over $18 dollars and placing a stop sell order at $18 to cover myself in the event of catastrophe in POS. I'm 'happy' to risk £5-£10K on this play as I'm so concerned about the value of my savings (I hold no assets other than cash at the moment). I can't see a major downside to this position, other than possibly losing £10K of paper if I hit my stop and silver then stalls, which I'd 'lose' through inflation anyway over the next 12 months and the upside is obvious ('profit' of £45K paper if silver hits $30). You guys have finer minds than me, so at risk of presumption I'd be grateful for opinion on this strategy. I'm aware of the process risks around spreadbetting per se, but my experience with the company I use is that they always trigger stops and orders when I want, and their customer service is very good. Of course, if f***ing interest rates were set responsibly, I wouldn't even be thinking about this play

i hope he wouldn't get that, although I suspect he would (but never admit this to me) Peak oil is a concern, along with peak water, peak bloody everything that we need to survive. All while the wunch of bankers control our means of exchange.

It's 'good' for us who hold PMs today, but I worry about the consequences for the world (or, more specifically, people and their livelihoods), if this whole thing gets much worse. People who use HPC will be aware of CGNAO - looks like his dire predictions may be coming true. My happiness at a four figure gold finish is tempered by this concern. I gave my 11 year old a life lesson today. I told him, "never trust a banker".

Thanks for the warm welcome.

hello all - just found out where all the HPC gold crew have gone. more of a silverbug myself - look forward to some useful ag discussion here. first discussion point - pullback over? new support 1930-1950?