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gold1017.png

 

Ker,

 

I’m really enjoying your charts (even though I don’t like what’s being shown at the moment :unsure:).

 

Keep up the good work, it’s very much appreciated :)

 

EDIT: I’ve changed my mind. I like what I am seeing. I have some dry powder in BV and a fall like the one on your chart will do me nicley ;)

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If anyone is interetsed the wikipedia article on TA is pretty interesting:

 

Lack of evidence

 

Critics of technical analysis include well known fundamental analysts. For example, Peter Lynch once commented, "Charts are great for predicting the past." Warren Buffett has said, "I realized technical analysis didn't work when I turned the charts upside down and didn't get a different answer" and "If past history was all there was to the game, the richest people would be librarians."[7]

 

Most academic studies say technical analysis has little predictive power, but some studies say it may produce excess returns. For example, measurable forms of technical analysis, such as non-linear prediction using neural networks, have been shown to occasionally produce statistically significant prediction results.[27] A Federal Reserve working paper[10] regarding support and resistance levels in short-term foreign exchange rates "offers strong evidence that the levels help to predict intraday trend interruptions," although the "predictive power" of those levels was "found to vary across the exchange rates and firms examined."

 

***

 

Ker, you have a biological neural network, are you using non-linear predictions?

 

Edit: I wonder why the FED would be interested...

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what do you mean?

 

Normally moving average channels have the graph line bouncing around inside them. What you have discovered, if indeed it has a name, is a region of purest "empty"...

 

Edit to add: :D

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Not to get into the TA debate, but Ker what are your thoughts on point and figure charts. I think you would get better channels using them...

 

The pnf charts are the only ones I have any real faith in as they filter out all the noise...still they only help, they do not decide when to trade...

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We can all throw together charts and draw lines and suddenyl see clear trends on them - however this does not account in any way for the situation and circumstances that we are in just now

.

.

.

None of us can possibly make these calls on charts.

 

Sash I completely agree. I'm baffled by some people who appear to be goldbugs/investors based on their belief in systemic difficulties - and yet continually seem to rely on fib seqs, eliot waves & other curve-fitting rubbish (can you tell I have no time for chartists? ;) ) which are based upon the system they claim to see coming apart at the seams.

 

This is more targetted at the kitco gold forums crowd, but I occasionally see it here.

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gold1017daily.png

Good chart. I'm thinking almost exactly the same thing for a number of reasons.

 

1) A mid cycle bull usually has a 50% correction.

2) Elliot wave theory shows we've made a 4 point move down with a final 5th incomplete.

3) There isn't a great deal of support at these levels but a lot of strong support in the $650 area.

4) Deleveraging. Until this ends, people will have to keep selling gold.

 

 

 

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Good chart. I'm thinking almost exactly the same thing for a number of reasons.

 

1) A mid cycle bull usually has a 50% correction.

2) Elliot wave theory shows we've made a 4 point move down with a final 5th incomplete.

3) There isn't a great deal of support at these levels but a lot of strong support in the $650 area.

4) Deleveraging. Until this ends, people will have to keep selling gold.

 

This TA is all very well but I think, come Tuesday, when we find out exactly who's short of funds to settle their share of the $300+bn of Lehman CDS liabilities, the market won't give a monkey's about charts. There'll be a mother of all panics and gold will react accordingly. If it turns out that everything's fine and dandy, then we can talk about charts.

 

I'm probably totally wrong but there's gotta be a reason why the interbank rates have remained stubbornly high. There's gotta be a reason that the Fed's dicount window dished out about £440bn a DAY last week and $420bin a day the week before despite the bailout approval, despite the backstop in commercial paper and despite the Fed and its counterparts around the world guaranteeing interbank lending.

 

I think a hedge fund has bitten the dust somewhere

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This TA is all very well but I think, come Tuesday, when we find out exactly who's short of funds to settle their share of the $300+bn of Lehman CDS liabilities, the market won't give a monkey's about charts. There'll be a mother of all panics and gold will react accordingly. If it turns out that everything's fine and dandy, then we can talk about charts.

If fundamentals drove the paper price of gold it would be well over $1200 by now. The fact is I don't see this market as the real price of gold which we know is being bought in the retail sector in record volumes.

 

$650 gold might bring some problems for the cartel as it attracts further physical buying that could potentially lead to a comex default. I hope it happens so we can find the true price of gold.

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If fundamentals drove the paper price of gold it would be well over $1200 by now. The fact is I don't see this market as the real price of gold which we know is being bought in the retail sector in record volumes.

 

$650 gold might bring some problems for the cartel as it attracts further physical buying that could potentially lead to a comex default. I hope it happens so we can find the true price of gold.

yes

 

me thinks the cartel could be going the same way as the Hunt brothers

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...

I suspect that if gold went to $500, a LOT of people who didn't get in as early as you did, would be seriously f***ed off; especially if they emulated your 100% PM strategy.

People should know what they're doing. I know what I am doing. Kids should definitely talk to their parents.

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This is a excellent post and very thought provoking on axes thread. It was posted by hotrod and is from goldrunner ( not seen his stuff before ). Hope I have covered all the copyright stuff ;)

 

 

http://goldismoney.info/forums/showthread....66&page=527

...

I concur 100% with the opinion expressed in this post/article.

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Ok - just spent a few minutes getting my head back round pnf charts for gold - i used to swear by them when i believed in shares...and they helped me get out of the market with some nice profit once i realised the house always wins...

 

Using this chart:

http://stockcharts.com/def/servlet/SC.pnf?c=$gold,P

 

and a ruler, I think we are in for a world of pain...I guestimate that we could go to lows of 740(hopefully), 715(medium) or even 700(worst). Also 860 looks like the resistance level - if we break that then we could go to 920...

 

Just my opinion - please don't take this as investment advice....but please keep me updated if you think I am wrong or right. I would like to refine my methods...

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Ok - just spent a few minutes getting my head back round pnf charts for gold - i used to swear by them when i believed in shares...and they helped me get out of the market with some nice profit once i realised the house always wins...

 

Using this chart:

http://stockcharts.com/def/servlet/SC.pnf?c=$gold,P

 

and a ruler, I think we are in for a world of pain...I guestimate that we could go to lows of 740(hopefully), 715(medium) or even 700(worst). Also 860 looks like the resistance level - if we break that then we could go to 920...

 

Just my opinion - please don't take this as investment advice....but please keep me updated if you think I am wrong or right. I would like to refine my methods...

 

I posted this in another thread

 

 

I consider these to be facts about market timing that we should use to establish discipline in investment strategies. I'm interested to hear if anyone disagrees with any of them:

 

* If you're trying to predict what the markets will do then you're trying to predict what other people do and if they follow TA you can profit from it too.

 

* If you invest at a random time, then you're as likely to gain as to lose from your timing, so TA can only profit where people try to time the markets but lose. So the average use of market timing is neutral. [Compare to paper, scissors, stone].

 

* The maximum gain from TA can be calculated based upon measurable upper bounds of annual returns from market timing, by considering known limits to wealth growth.

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Always an interesting watch. Doesn't mean I agree with it :D

 

Will particularly interest the traders/TA people of gold & gold stocks.

Predicting ABX down to 19/20 !

 

Adam Hewison

President, INO.com

Co-creator, MarketClub

 

Gold, it's a game changer

http://broadcast.ino.com/education/gold_ga...r/?campaignid=3

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Ker,

 

I'm really enjoying your charts (even though I don't like what's being shown at the moment :unsure: ).

 

Keep up the good work, it's very much appreciated :)

 

EDIT: I've changed my mind. I like what I am seeing. I have some dry powder in BV and a fall like the one on your chart will do me nicley ;)

 

thanks! I have made a bit more precise aproximation of the bear trend. if it does confirms the down move on tuesday, it will likely to happen this way:

gold1018-1.png

gold1018-2.png

(spent about 2 hours making it, really though work!)

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thanks! I have made a bit more precise aproximation of the bear trend. if it does confirms the down move on tuesday, it will likely to happen this way:

Nice charts. Have you looked at this old trendline. Any thoughts on this holding? The september move to $740 looks like it just needed to pay some fibonacci respect.

 

trendkx4.jpg

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Nice charts. Have you looked at this old trendline. Any thoughts on this holding? The september move to $740 looks like it just needed to pay some fibonacci respect.

 

Thanks, yes, I looked at it, but I do not give it much weight because it is an old trendline, and the best thing is to use as fresh data as you can. Sure, it can hold for a while, but... I think that stock markets will put another low on tuesday, and this will be the real bottom, because i still hear a lot of people calling the bottom on stocks, and that is influencing the dollar a lot. I have to study stocks and other commodities this weekend, to see if they have any dump pattern comming.

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Hmm, that's the problem with TA, any number

of analyses can give a plausible answer, but

only one of them turns out to be right.

ABB

 

I think it has two purposes:

1. It can improve the odds. Anything that's helps you to beat the 'house'.

2. It can aid in thinking about the subject.

 

I think there are two types of person. Those who think the house is using fair dice, and those who think they sometimes swap them for weighted ones.

I'm the latter. To me that makes TA even more difficult sometimes.

 

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I can more or less understand the reasons why PMs may rise substantially in value in the future, but I'm sure someone could present me with reasoned arguments why PMs will fall in the future (short-, medium- or long-term), and I would be equally easy to convince. The movements of silver and gold lately are just a complete mystery to me. It seems like everything in the world is just worth less than it was -- whereas, in my simple model of the world, some money must be flowing into something and increasing that something's value, and I assumed that would be gold and silver...

 

In my case I have a time horizon in mind. Short term, everything should continue to contract with deflation in the wider economy [due to the continued credit crisis] and deleveraging in assets. This is a purely temporary phenomenon. At some later stage, macro fundamentals will have to kick in; the US economy in is dire shape and with it the dollar will have to sink. At this time, we could expect to see chronic inflation and it is here your PM investment should pay off handsomely.

 

As for me, I do not see gold so much as an insurance policy.... crikey we are only witnessing a depression not complete destruction. I see PMs as the investment opportunity of a lifetime. :)

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No argument from me on this at all but, let's be honest here, most who have invested in PMs have done so with a view to realising a profit. If this wasn't so, then why would there be so much focus on buying on dips in, say, silver ? Sure, there is the "insurance" element but when you go out and insure your life, do you ask for a specific sum assured based on what your dependents would need to live comfortably or do you plonk down £100,000 and ask "I want the maximum sum assured this premium can buy me" ?

 

The underlying hope of many PM investors, I suspect, is to one day, when the much-heralded fiat currency destruction we're expecting actually arrives, is to exchange some of our pile for a damn sight more than what we can now with a view to, perhaps, buying a nice house or what have you without a need for credit.

 

There is nothing wrong with a member expressing concerns and seeking reassurance which is what I think Ologhai was looking for as a relatively new entrant into PMs. These moves are disconcerting to some so I just thought that he should've received a better response than "get outta the kitchen".

 

This would IMO constitute a re-booting of the economy, bringing shelter [a basic necessity of life] into reach once again for a new generation. And here we have the politicians, with their price-fixing scheme, trying to keep afloat a fundamentally unjust and corrupted economy.

 

Won't work... there are economic laws, and just ones at that, at work in the universe. :)

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We can all throw together charts and draw lines and suddenyl see clear trends on them - however this does not account in any way for the situation and circumstances that we are in just now. Previously unheard-of forces are pulling on currencies, stock markets, commodities and PM's. Bond this with redundancies, unpredictable government manipulation and panicking masses and I genuinely do not see how your charts can account for all of these factors. None of us can possibly make these calls on charts.

 

All the same, I do find them entertaining. :)

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