GOLD

[G0ldfinger]

Gold in GBP looks very nice indeed:

 

[tinecu]

I agree with what you say, just am curious as to why TA chartists always just use the USD.

 

Yeah, I was wondering that too. This has always been TA's fundamental weakness IMO.

 

[kernull]

Ker,

 

Would you mind doing some of these charts and analysis in GBP. A lot of the people on this board are using GBP to buy rather than USD.

 

http://stockcharts.com/h-sc/ui?s=$GOL...id=p64060619744

 

The chart looks a lot different in GBP, not half as bearish, it looks set for surge up again soon. In fact it looks much more positive in loads of currencies. It has recently hit new highs in UK Pound, Canadian Dollar, Rupee, Rand & Australian Dollar. Why the focus just on USD?

 

I know Pixel, my trading account is in USDs, but for another currency , yes it is more complicated, in the chart in GBPs you refer to, the main monthly trend is bullish, but it looks like 5.50 is the resistance right now, and you have high volatility, means it is not in a trend, but a consolidation process, it may pull back a little bit (4.60), the best buy in your case would be when it is close to 200 exponential moving average (or lower), and the volatility is low, this should be entry points. but I suggest you to draw the trendline from the 2002 , like in my charts, and when it touches that trend, that's the buy for long term.

[ziknik]

EUR/USD:

OIL:

Stocks (Dow):

GOLD:

SILVER:

 

Wow, I'm long on all of the above.

 

I hope you are wrong*.

 

EDIT: * I'm not wishing loses on you

[electroweak]

I think the fact that the USD/XAU graph looks Sooooooo much smoother in USD than any other currency over the period 99-07 (e.g. on the 20 year chart, set to High-low-close on BV) means that it is obvious the USD is 'the' reserve currency at the moment. That, I think is why people do TA in USD.

[kernull]

the chart has no prices, but the overall picture is like this

[Pixel8r]

the chart has no prices, but the overall picture is like this

 

Thanks for the GBP outlook.

 

What is the reason as to why the trend line is not now set at a higher angle? Isn't that what happens when are market goes exponential.

 

 

[Catflap]

This is a great article and a must read:

 

http://www.kitco.com/ind/GoldReport/nov142008.html

 

[Ret45]

This is a great article and a must read:

 

http://www.kitco.com/ind/GoldReport/nov142008.html

 

 

It seemed to be just another cheerleader article on commodities, with a lot of conjecture about inflation. I don't understand the basis for speculating that we are halfway through a bull run on commodities and there is another 15 years left to go. Why not five years, or ten, or fifty. What in particular is going to trigger the end of a bull run in 2023?

[Magpie]

Thanks for the GBP outlook.

 

What is the reason as to why the trend line is not now set at a higher angle? Isn't that what happens when are market goes exponential.

 

Just to be pedantic...

 

1) Trend lines should really be upward sloping curves if there is an exponential growth in play. You'd be be better off trying to draw an exponential curve as the trend line rather than a new straight line.

 

2) What do you mean by "going exponential". An exponential curve is exponential from the start - the shallow bit at the left hand end becomes a steep slope at the right hand end of a graph. There isn't a point where it 'goes exponential', it is simply a curve whose gradient increases as a result of reiterated %age increases. If you redraw the graph starting from the right hand end, and assuming a constant rate of growth, you will have the same pattern with a shallow curve as the 'now' and a steep curve at the end of the timeframe selected.

 

I know this is pedantry, but I find "exponential" to be one of the most misunderstood adjectives in economic discussions.

[G0ldfinger]

Just to be pedantic...

 

1) Trend lines should really be upward sloping curves if there is an exponential growth in play. You'd be be better off trying to draw an exponential curve as the trend line rather than a new straight line.

...

Here is the logarithmic chart:

[Catflap]

It seemed to be just another cheerleader article on commodities, with a lot of conjecture about inflation. I don't understand the basis for speculating that we are halfway through a bull run on commodities and there is another 15 years left to go. Why not five years, or ten, or fifty. What in particular is going to trigger the end of a bull run in 2023?

 

Not really, this guy really knows his stuff and published a book in January 1999 titled "Stock Market Panic! How to Prosper in the Coming Bear Market". He's not speculating that we are half way through a secular commodities bull market but is stating a view based on past cycles. Secular commodity bull markets start where secular stock bull markets finish, ie 1929, 1966 and 2000. The halfway point starts when stock markets crash and bottom out and a primary recession begins - this occurs around 8.5 to 9 years after the secular stock market bull run has ended, ie. 1938, 1974 and now.

 

The end of the bull run in commodities will happen when p/e valuations on stockmarkets are at very low levels, even lower than they are today but I think 2023 is pushing it a bit and my guess is that the end of the cycle will happen in around 2018 to 2020 (18-20 years).

 

 

 

[kernull]

Thanks for the GBP outlook.

 

What is the reason as to why the trend line is not now set at a higher angle? Isn't that what happens when are market goes exponential.

 

i think you are right. the trend may be set at higher angle, but the volatility is very high, dust should settle down, before any big upside happens, here are some more points

[Pixel8r]

Here is the logarithmic chart:

 

Thanks GF, looks nice with a curve on it.

 

 

 

[Steve Netwriter]

Yeah, I was wondering that too. This has always been TA's fundamental weakness IMO.

 

I've been making this point for ages:

 

Gold & Silver in US$, EUR & JPY with MAs

The results may surprise you

http://www.greenenergyinvestors.com/index.php?showtopic=3293

 

[G0ldfinger]

Thanks GF, looks nice with a curve on it.

...

What's your comment on double exponential, Magpie?

[electroweak]

Thanks GF, looks nice with a curve on it.

that really IS hyper! - an exponentally growing log-plot! wow.

[fexx]

Crikey, if it continues in this bearish pattern, I might not be able to afford any soon.

 

Thanks for the charts Ker, I sincerely appreciate your views.

I wasn't trying to be sarcarstic, just pointing out that in this debate on POG declining, it has been getting steadily more expensive to buy for anyone with GBP.

Which I imagine would be quite a few people on here.

[ologhai]

I am in the UK

 

UK may go the same way as Iceland

 

Gold will protect me from that so I am sticking with gold.

 

If the UK does 'go the same way as Iceland', what will be the effect on people's everyday lives in Britain?

 

The value of sterling will drop dramatically compared with other currencies, right? If Britain exported anything, it would therefore be cheap in other countries. Anything we import (i.e. everything) will become more expensive...

 

So, prices will go up dramatically in the UK?

 

Am I right so far? What else might happen?

 

Any thoughts received with interest (no pun )...

[The Mad Hatter]

More exponential pedantry ...

 

New Element to the Periodic Table "Governmentium" (Gv)

 

Thank you very much for that! I was giggling like an idiot for quite a while.

 

[romans holiday]

This is a great article and a must read:

 

http://www.kitco.com/ind/GoldReport/nov142008.html

 

Pure fiat currencies usually end in inflation, not deflation.

.....

Right now we have asset deflation. I don’t think we’re going to have deflation in the entire economy.

 

The economy relies on spending. If consumer confidence evaporates and the economy deflates, whether we use fiat or non-fiat is besides the point. When the consumer happily starts spending again I will change my mind.

 

Also, difficult to argue from what usually happens to what will happen.

 

 

Hmmm... how to get back on topic. Ahhh but gold will do well because the paper asset of fiat itself will deflate.

[grasslizard]

It looks like someone else is stocking up on the shiny stuff: FT Alphavilla

 

Riyadh: There has been an unprecedented demand for gold in the Saudi market recently, with over 13 billion Saudi riyals (Dh12.75 billion) being spent on the yellow metal during the last two weeks.

It seems to be just local investors (not the government) snapping up the gold — about $3.5bn worth.

[Catflap]

Also, difficult to argue from what usually happens to what will happen.

 

Exactly, no one really knows with any certainty - you just give it your best shot and try to stack the odds in your favour. The part of the article which I thought was really important was this:

 

If we get this retest to the market in December after the short term decline in the dollar, you might see another rally out which can hit gold maybe back to around this low $700 area. But if I’m right and the market rallies next year, and this fourth quarter is really the bottom, gold will reach $1,000, even $1,100. The opportunity right now is not in gold; it’s in the gold stocks. Even with this rally that we’ve seen in the gold stocks – for example, the XAU to gold ratio, which is the percentage of the XAU’s trading of the price of gold—it’s usually 22%, which means, for example, gold – let’s make it easy – is $1,000, the XAU is $220—even with today’s rally, the XAU is about $90 and gold is about $750, right?

 

TGR: Right.

 

DS: When you do the math that’s about 12%— almost half of the historical ratio. So if gold were to go to $1,000, the gold stocks can more than double. There’s a time to buy gold instead of stocks and there’s a time to buy stocks. I’d be looking at the smaller, lower-cost producers.

 

TGR: What about buying seniors who have just been battered versus juniors that have a potentially higher upside?

 

DS: For the average investor, I’d be looking at seniors because they are so cheap. When I say juniors, I’m talking about junior producers with lower levels of production because they have cash flow. And, again, it’s the whole leveraging thing. Hedge funds own them, too, and they’re even more liquid than seniors. So instead of the seniors, which all went down, say, 60 to 70%, the juniors, in many instances, went down 70 to 80% or even 90%.

 

[Magpie]

What's your comment on double exponential, Magpie?

 

Exponential squared, to be precise.

 

Could be, though since one part of that equation is the cable rate in the latter stages, I'd have thought it's more like a straight line with a bump up in the later stages. USD/GBP won't keep on changing at the current rate, though there may be a bit further to go from here.

 

[romans holiday]

Exactly, no one really knows with any certainty - you just give it your best shot and try to stack the odds in your favour. The part of the article which I thought was really important was this:

Bob Hoye is big on gold stocks also. They have taken such a pounding surely they can go no lower.

http://howestreet.com/audiovideo/index.php...ediaplayer/1027