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Gold comments - for the first half of 2008


drbubb

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Steve,

 

I'm very much here, but Yep, busy trying to work out next buy now G and S have both spiked this afternoon and freed up some margin! I will read through your posts in detail after this post, but what happened this afternoon between my going out for a job interview (which I'm questioning whether I really want.... :lol: ) and checking prices at 9pm GMT?

 

 

 

Is it:

 

* Fed cuts growth forecasts and raises unemployment outlook?

* Darling gets a tax windfall but public finances screwed anyway?

* ECB to cut rates tomorrow?

* Female G spot can be detected (Oops, how did that get in there??!!)http://news.bbc.co.uk/1/hi/health/7254523.stm

 

Anyway, I'm sure after the spike will come a sharp fall of some description. Must resist the temptation to cash some chips and just wait for the latest upward move to validate to a trend.

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Steve,

 

I'm very much here, but Yep, busy trying to work out next buy now G and S have both spiked this afternoon and freed up some margin! I will read through your posts in detail after this post, but what happened this afternoon between my going out for a job interview (which I'm questioning whether I really want.... :lol: ) and checking prices at 9pm GMT?

 

 

 

Is it:

 

* Fed cuts growth forecasts and raises unemployment outlook?

* Darling gets a tax windfall but public finances screwed anyway?

* ECB to cut rates tomorrow?

* Female G spot can be detected (Oops, how did that get in there??!!)http://news.bbc.co.uk/1/hi/health/7254523.stm

 

Anyway, I'm sure after the spike will come a sharp fall of some description. Must resist the temptation to cash some chips and just wait for the latest upward move to validate to a trend.

 

Forgot to say

 

Is it:

 

* Cost of debt protection spreads climb to an all time high with "traders rushing to unwind highly leveraged positions in complex structured products" and finding a new home (safe haven) for their money?

 

If it is this could this be the start of something big in PM prices? and the beginning of the end for stocks?

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I think it's the G-spot one.

I can't believe they need ultrasonics !!!!!

 

Actually, I think it's that people are reading this thread:

 

What Do You Make Of This?

http://www.greenenergyinvestors.com/index.php?showtopic=2781

 

:lol:

 

 

Yes, it might just be something to do with debt. Bank write-downs, the Fed bailing out the banks, inflation......

 

Or maybe they looked at this:

http://docs.google.com/TeamPresent?docid=d...p;skipauth=true

 

Yes, they are fooked B)

 

"If it is this could this be the start of something big in PM prices?"

 

Did you see my chart ?!

I'm getting the definite impression the past 6 years has just been the build-up.

Now we get the real action.

 

Maybe this chart does reflect the future. Does the past show the future ?

 

Now_versus_1970s.gif

 

Steve

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From the "Guidance" thread

 

1/

My first Gold investment was in ML G&G in June 2006 and that is now showing an 86% gain. Have added a lot more on the way and am optimistic for the future. My reasons for investing in gold was to to pay off the mortgage as the endowment policies I had were not performing. The good news is that the next move up in ML G&G will achieve that goal!

 

that's great going!

 

May I offer a suggestion:

If Gold hits $1,000+, don't be afraid to use a stop on a part of your position.

 

I think it is likelt that the "ground" between $930 and $1,000 will get retraced (at least once) at some stage

 

2/

I get a gut feeling that we may see 1000$ very soon......possibly by the end of this month

 

Yes, we may.

But dont forget that gold has a seasonal tendency to peak between March and May

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The Fishy Smell Of Streettracks Gold ETF's Reported Holdings

Author: Dan Norcini

 

Dear CIGAs,

 

Something smells mighty fishy to me about what is going on in this ETF of late. Some of us have long believed that the inherent flaw in this ETF is in its auditing process which is less than transparent. If the bad guys who comprise COT and are the price managers on behalf of the US monetary authorities needed another source of gold for the supply that they feed into the market to suppress the price, the ETF is a perfect vehicle for this. I find it a huge stretch of the imagination to see gold soaring into all time highs and the one major indicator of investment demand for that same metal sitting there unchanged when it comes to reported holdings for nearly two weeks! I just read this AM that platinum and palladium holdings in the London ETFs for those metals are soaring because of investment demand. Why then is the gold ETF not reporting a sharp increase in its holdings? To believe that nothing has changed in there is to believe that the sun rises in the West.

 

http://www.jsmineset.com/ARhome.asp?VAfg=1...amp;T_ARID=5851

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Maybe this chart does reflect the future. Does the past show the future ?

Now_versus_1970s.gif

 

Interesting chart.

Perhaps we will get a mid-cycle correction after a test of $1,000

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(Lemain's Summary - from the RUG thread):

 

Lemain - 22 Feb'08 - 08:10 - 34878

 

Friday 22nd February

 

Posters' comments yesterday...

...............................................................................

sbs - 21 Feb'08 - 22:50 - 34875 of 34877

 

Look at Pt - the "correction" still hasn't happened despite over a dozen consecutive record closing prices. This is because of a temporary supply shortage. Gold may behave the same way, but for a different reason - the demand side.

 

It seems the mood is slowly changing to make Au an acceptable investment, so any sellers are being overwhelmed by new buyers. It's been a long time coming, but there are a lot of people underweight in gold who may choose to catch up. There's only so much gold central banks can sell before they begin to doubt their actions.

 

Would you want your central bank to be the last to leave the USD party? The blow off top in gold could be dramatic.

................................................................................

 

Dummkopf closed his long at $951 and is still warning of a major pullback "a monster down day"; he is a well-respected poster who is mostly in tune with the market. lasata (Message 34842 posted a quote "Speaking to the Globe and Mail, Patricia Mohr, vice president of industry and commodity research for Bank of Nova Scotia, said that central bank gold sales should "level off" by the end of the year after last year's 32.7 per cent increase." John Hampton is another bear, talking about $850 on a dollar bounce.

 

There was some interesting and informed discussion about oil in the early morning yesterday from 0830 onwards.

 

A number of posters pointed out that the present rise in gold is consistent with the charts and historical patterns.

 

 

My own comments...

 

P&F charts gave a Bullish Triangle breakout on 20th Feb which is confirmed by the price action since then. All of the other technical indicators are showing positive. The number of long speculators is near a record high. However, note that these speculators would quickly go short if the trend changed down, suggesting that a pullback would be very sharp, were it to happen.

 

Something - call it gut feeling - tells me that gold is not breaking out as fast as it should - is this a false breakout? Failure to maintain $950 at the close added to my concern. However, when I arrange all of the facts and leave aside my emotions I see only a positive uptrend from here on. I think it was Jim Sinclair who said months or years ago that there would be the mother of all battles at $950. Overnight saw further losses on the Asian equity markets and as I write the European futures are heavily down (>0.5% down) while gold is holding up ($944.50). My feeling is perfectly summarised by sbs's post (above) - I would have written the same had he not got there first. It is genuine main-stream investor demand that is keeping gold up and will continue to do so. While there could be a pullback, I think that the public are now fuelled by fear and to a lesser extent by greed and see gold as an essential part of their portfolios.

 

I do not see the equity markets making any meaningful recovery; they are now in a downtrend. I see no reason why equities should rise; the majority of companies exist one way or another to satisfy a consumer-led economy. The consumer is sick and the economy is in a dire condition. Earnings will fall. The one element of value that firms can preserve is market share for when the good time return but they all know that and the cost of maintaining or growing market share will destroy many in the attempt. Money for investment (savings, pensions) will have to go somewhere - much of it will go into gold in one form or another.

 

Today, We are possibly establishing a new trading corridor, as a guess $940 to $950 but this will be very sensitive to bad news. Yesterday's rise was due to news and the rise held.

 

Good luck, have a superb day and a wonderful weekend!

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...from a clone thread on HPC ...

 

I think $1,050 (which we might see soon) could become a critical point for gold. But I think any correction would be short-lived.

http://www.housepricecrash.co.uk/forum/ind...st&p=983935

 

If it moved quickly from $950 to $1,050, then I think it would retrace soon to $950.

Because most areas of trading (price ranges), get retraced at least once.

 

Thus, the breakout above $850 to $920 got retraced recently, before Gold move higher.

 

That is my KIGB ("Kiss It Goodbye") principle in action.

Markets tend to come back to important breakout points and test them - before they move higher (or lower). And those "kisses" are often the best points at which to initiate trades. So if you are already long gold, let the breakout run for a while, and then SELL SOME when the movement's volume begins to lose volume and falter. Chances are, it will return to the breakout point. to test it. If it just "kisses" that point, you may want to buyback in.

 

CHART: shows two KIGB returns- the second one was very small, back to about Gold-$922

gldjg8.gif

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I just thought that for the sake of historical record it was worth posting this.

 

cmgold.jpg

 

Nice tie, why do socialists like the colour of blue so much?

 

One of the WORST trades ever...

But stuffing the Telecom co's with huge costs for bandwidth at the top of the dotcom bubble

was one of the best ever. If he worked for an IB, Brown would have gained a big bonus after

these two big acts

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South African power problems, Gold Fields press release.

 

Full release

 

http://www.resourceinvestor.com/pebble.asp?relid=40720

 

 

Extract

 

Johannesburg, Monday, February 25, 2008: Gold Fields Limited gold production for the current quarter (Q3 F08) is forecast to decline by between 20% and 25% against the December quarter (Q2 F08), as a result of the total suspension of production for one full week due to power constraints, continued power rationing, and the seasonal impact of the Christmas break.

 

It is further confirmed that, as a consequence of the 10% power reduction imposed by Eskom, sustainable production at Gold Fields’ South African operations is likely to decline by between 15 and 20 percent from the June quarter (Q4 F08) onwards, as previously advised.

 

Eskom has indicated that the current quota of 90% of average historic electricity consumption will remain in force for at least five years, through to 2012.

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from Kevin Kerr:

 

Gold demand in China relative to GDP is about five times higher than in the U.S. And this robust demand is growing. Gold consumption in Mainland China rose 25%, to 78.9 tons, in the three months ending last September.

 

But the real opportunity for gold in China comes with China's central bank. For several years, Yu Yongding, a committee member of the People's Bank of China, has advised that China use its foreign currency reserves - the largest in the world - to buy gold. He's not the only one. Other Chinese economists are urging their government to QUADRUPLE the nation's gold reserves.

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Jim Sinclair & Ron Paul

 

From: http://radio.goldseek.com/

 

Here: http://radio.goldseek.com/GSRplayer02.30.08.php (embedded stream)

 

And here: http://radio.goldseek.com/shows/2008/02.30...-02.30.08-c.mp3 (56MB)

And here: http://radio.goldseek.com/shows/2008/02.30...02.30.08-cc.mp3 (27MB)

 

 

I'm not sure when the interview(s) with Jim were done.

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I have literally just got out of my car where BBC radio 5 live have done an interview with none other than Mr Ratner. The jist of the interview highlighted the rising price of gold and platinum, but also the increasing popularity of palladium as an alternative in jewellry. Nothing groundbreaking here i hear you say, but throughout the weekend i have noticed a significant increase in the exposure the precious metals are getting in the general media. Are we witnessing the awaking beast that is "hysteria phase" and whats going to happen when $1000 gold is breached? Ratner reflected that during the 80's the general public sold off their jewellery in markets, some even going as far as melting it down. Being a youngster i cant really remember those days!! :P

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Was this the subject of Jim Sinclairs PDAC presentation.

From his article today

 

Down to business:

 

1. Gold has never made it thorough a round number without a battle. You may recall every 100 points since $248 gold battled at each $100 mark.

2. To assume we are going through $1000 with ease can only occur if my $1650 magnet is so low it is silly.

3. I don’t assume that.

4. The real number is not $1000 nor $1050 but rather $1024 with a maximum over run of $26. You may recall I suggested the run to $1000 was going to be as straight up as markets can perform.

5. I would expect a break above and then some rotation around $1000 until the third day above $1000. Following that it is off to $1650.

6. I will give you more minor angels as we move past $1024.

7. The ratios long the majors and short the juniors sold as an OTC derivative by the same geeks that have brought you the end of the financial world as we knew it, also produced the gold share ratio spread.

8. This spread is starting to contract now as the majors decelerated their climb and the juniors in the main have decelerated or ended their decline.

9. The US dollar has been for a long time and is now totally hopeless.

10. The price objective on the downside of the dollar is .5200. It will get there.

11. Gold is going to $1650. Remember this. It will get there.

12. No commodity share is going down when the underlying asset of the company is going to establish at least an appreciation of 665% from the low. The geeks only look at the momentum of a spread once again forgetting a thing called a market. When the recent OTC derivatives skewing a market explodes, as it will, the juniors will fire out of their silo like an ICBM, doing nuclear damage once again to those criminals and their overloaded laptops.

 

--------

 

Mildly confident !!!!

 

 

.

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  • 2 weeks later...
One of the WORST trades ever...

But stuffing the Telecom co's with huge costs for bandwidth at the top of the dotcom bubble

was one of the best ever. If he worked for an IB, Brown would have gained a big bonus after

these two big acts

 

Last week's Economist (March 8) made the reasonable point that Brown's error in selling UK gold was dwarfed by Geoffrey Howe's error in not selling at the early 80's peak:

 

The rise in the gold price has revived the prickly issue of whether central banks were right to sell their reserves earlier this decade. In answer to a parliamentary question, Britain's Treasury recently admitted it had sold about 12.7m ounces for $3.5 billion, an average price of around $276. That gold would now be worth around $12.5 billion.

 

But if we are excoriating finance ministers for market timing, the mistake made by the then chancellor, Gordon Brown, pales into insignificance against that of his predecessor, Sir Geoffrey (now Lord) Howe. Had he sold the same 12.7m ounces at the 1980 price peak of $850 (admittedly a difficult task), he would have received nearly $11 billion. Investing that in Treasury bonds since then would have returned 7% a year in real terms, accumulating more than $100 billion. Instead, the money was left in non-interest-earning gold, leaving British taxpayers more than $90 billion down on the transaction.

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Ratner reflected that during the 80's the general public sold off their jewellery in markets, some even going as far as melting it down. Being a youngster i cant really remember those days!! :lol:

 

I remember talk around my secondary school in 1980/1981 about a teacher who had taken early retirement to start an antiques & jewellery business. Gossip round the school was that she had made a killing selling her stock of gold jewellery for scrap at the peak.

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  • 2 weeks later...

(from Neowave):

 

As a public service, on many past occasions I have issued general announcements about major market turns in the S&P, Notes, the Euro and Gold.

 

Today's announcement is on GOLD. Following last week's massive, $130 collapse, Gold has given us EXACTLY the move required top confirm the bull market is OVER!

 

As usual, with any major market call that is contrary to the public's belief system, this will come as a shock and be immediately rejected by the majority. But, there is no denying Gold has experienced its largest, fastest decline in over 10 years, which virtually guarantees a multi-year correction has begun.

 

If you want to be prepared for years of DEFLATION, not inflation, and you want to benefit from a rising dollar and falling Gold market, make sure to join before it is too late. Go to http://www.neowave.com/product.asp and pick the Gold service that best fits your needs.

 

Glenn Neely

NEoWave, Inc.

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Should I be rushing to buy the US$ ;):D

Is he a good contrarian indicator ?

 

Glenn/ Neowave has made some great calls. I cannot deny that.

 

If Neowave is right, and the bull market in Gold is over...

 

After a rally to Gold-$950/60 (or so), the next drop could be brutal,

not the gentle C-wave affair that I am expecting (or at least hoping for)

 

Personally, I would be surprised to see that, because we did not the obvious parabolic move

that generally preceeds a major top, and I dont really think that "th public" is much into Gold yet

 

GLD chart (x10 + $10 for Gold price) ... update

 

bigzc6.gif

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He's also made some wrong calls. One when gold was at $550 calling for a return to $300 or similar.

There's a thread on him at ADVFN isn't there?

 

True, but he's been much more bullish on Gold than many other E-wavers.

 

...here's Dennis Gartman's comment - similar to my own ...

 

THE GOLD ETF (GLD):

Running Into Resistance?

We are bothered by the fact that this trendline was broken

and that very real damage was done to the gold market's

psyche in the process. Thus, this first "bounce" from last

week's lows is likely to fail as we move toward "The Box"

which marks the 50-62% retracement level. That

equates to $965-$975 for spot gold.

 

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Glenn/ Neowave has made some great calls. I cannot deny that.

 

If Neowave is right, and the bull market in Gold is over...

 

In hindsight (which is always 20:20) it looks like that Glenn was right. I was expecting the credit crunch and inflation fears to keep gold at it's high price. With almost every major bank in the US posting huge write offs I would expect the markets to be wary. But today was not expected, with UBS's doubling their write offs and the chairman resigning, the markets still rose and gold was dumped!

 

So what for the future? There is no intrinsic value to gold other than a storage of wealth, i.e. the safe haven for people to place their money in times of uncertaintity or 'low risk' investment (if people do still think that way, I don't...). If the market perception is that we are now done with the banking sector write offs and that with tighter regulations on lending there will be more stable growth in the market place, why should gold go back to it's newly found highs?

 

I have no idea on this, I am just an average Joe. It was my hope that being in early I could benefit from the rise due to the other average joe's investing their money as well, I actually though 1150 would happen given the broad news coverage when gold hit $1000/oz.

 

I still have a lot to learn, nothing better than experience I guess :)

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