Gold Price - Where is it heading?

[sinner]

This chart is SPDR GLD and 30y bond yield (which moves inverse to bond price, i.e. bonds up yields down).

Goldbugs are suggesting a flood exit from bonds i.e. "bond bubble". Even Marc Faber is short bonds and I like him. In my RYJUX thread I suggested it might be a good time to get in short too (double short in fact). Now I am not so sure: gold is forecasting bond strength now.

i.e. we should see a drop in yield from here.

(Although if you are a pairs trader you would go short gold and short bonds here)

 

[Bushman]

Instead you follow the nutter camp who claimed hyperinflation (incorrect), USD collapse (incorrect), commodities boom (incorrect), oil boom (incorrect) and only got two right: gold increase and short financials. What a joke.

.

LOL; I reckon go short 'fear', long 'optimism'. Its purely a psychological play at the moment. I like this description of the current action in treasuries and gold - the Fear Bubble.




www.financialsense.com/editorials/droke/2009/0309.html

 

[Uncle Festivus]

This is the only thread on ASF where people can talk baseless trash and get away with it.

EDIT: Oh one more bone to pick.

Oh, I don't know about that, I do it all the time on several threads and never get a speeding ticket

My advise would be to have a good sleep after nightshift, then post your often welcome & insightful thoughts? You do yourself no favours denigrating everyone, as you seem not to have made any distinction between posters at all?

 

[GumbyLearner]

Even though I said I would not reply you have once again goaded me into anger.

GumbyLearner deserves to be called out on his propaganda spreading junk. You also.

He could not explain the net short positions by the big instos in gold if he ever even tried. Just seeing them net short on the COMEX is enough for him to cry conspiracy.

What happened to the COMEX busting in December? Never happened did it.

Despite the fact that the gold price has been rising against this net short position for almost a decade (which completely invalidates his and your conspiracy theory), it also completely ignores the fact that just like other forms of money (of which gold is one) it must be lent out to make a profit. The same way central banks lease their money, they lease gold. Of course they will be net short! This is the job of the dealer! Do you think the bank makes money by leaving their cash in accounts? No! They loan it out! Just like gold!

Otherwise the natural rate of debasement for gold is 2% per annum, roughly the same as a basket of world currencies today. Also remember, international central bank holdings in gold is roughly 13% of total reserves and holdings, just like most portfolios should have! So these currencies are 13% backed by gold price!

He also claims quantitative easing as another reason gold will go up, but he cannot explain this measure at all or the mechanisms behind it or why any of this has any relation to gold whatsoever. This unchecked and willful ignorance sickens me. How can you claim quantitative easing will cause gold price to go up when every word you spout shows you don't even know what quantitative easing is or how it works.

I think the funniest thing of all is that all of you crazies are happy enough to rant against the banks and how they will all fall over and everything but you've still got a brokerage account with one or the other of them, probably long a bunch of gold miners which you expect to cash in for fiat at a huge profit.

i.e. you apparently detest fiat and the banks, but are happy to hold trading accounts and fiat backed shares on a fiat market with the goal of playing this market for a fiat profit. You say there is nowhere safe to put your money but gold explod, yet I know you hold or held gold mining shares since September. This is a blatant hypocrisy.

Just look at this quote



I can name several contrarian and Austrian school analysts who picked the downturn (correct), forecast deflation (correct), forecast USD increase (correct), forecast gold increase (correct), went short financials (correct).

But I won't. You have to go back and look through my posts if you want to see this as I have spent countless hours researching and linking to spoon-feed you like children while you post links to silly youtube nuts. Why should I contribute to your willful ignorance any further?

Instead you follow the nutter camp who claimed hyperinflation (incorrect), USD collapse (incorrect), commodities boom (incorrect), oil boom (incorrect) and only got two right: gold increase and short financials. What a joke.

So you can see just how gold has saved the nuts from themselves. You yourself claimed gold was rallying against market collapse but there is no proof of this since 1007 gold as I have challenged in my last above post. Gold has been selling off with the broader market with rapidly declining open interest.

If you are all so sure of hyperinflation, you should be short treasuries, not long gold! But not one of you has the guts to do this even though if your claims were only halfway correct you would be as rich as a Saudi oil prince by now.

The least funny thing is that I have repeatedly said all this before to GumbyLearner, he just ignored me and spouted more of the same crap which simply does not hold water. None of the mods care because they are so used to seeing irrational junk being spouted on this thread by the goldbugs.

This is the only thread on ASF where people can talk baseless trash and get away with it.

EDIT: Oh one more bone to pick.

explod you say you will be holding onto your physical because it will be impossible to get more once you sell it (or pay a "ridiculous" premium). Yeah right! How long have you even been buying gold? I have been a long term buyer (since I was as young as 5 I have held gold because of my heritage) and many of the "rational goldbugs" aka Austrian school traders I speak have been buying gold since it was 200 or less. This is the same premium as it was last year and all the years before that.

I can walk into Aus Bullion and buy an ounce of minted 999 gold coin or bar on the spot without filling out any forms or anything. The premium is 14% for 1oz and decreases as your purchase size increases. If you buy a 5oz bar the premium is less again and less again for a 10oz bar, etcetera.

There is no shortage in physical gold, just a production bottleneck for the increased demand in small denominations. 400oz LBMA bars are in fluid availability all over the world. You can take delivery on COMEX or CBOT bars just like any other commodity, but it will be in 400oz bars.

And you need to be called out on the fact that you have deflected debate
from the banks to your knowledge of T/A.

What at the age of 5 you first invested in bullion? Couldn't they stop you with the cryptonite back then Superboy?

I'll accept you have a ton of knowledge and I'm not knocking you personally.

Just let me know when I can short some financials! Then I will post some charts for you!

Do you know anything about Pyramid Building Society or Quintex? How can an outsider protect themselves when the "propaganda" (as you put it) isn't revealed by media sources until the very last minute? In an Australian context, I consider these as micro case studies of what is currently occuring in world financial insto's. It is also the reason that Australian regulation of the banks has held up well in this environment as opposed to others. But it still doesn't solve the global financial issues.

I better leave the "propoganda" to well-educated and informed experts.

Noticed last week the 17th US bank of 2009 was closed.
www.bankimplode.com

This is not financial advice
DYOR

 

[explod]

Have to remember G/L that we have the propaganda of "them" and the insitutions which has bred "our" propaganda and then we have Sinner who says he speak the truth but cause we are now gun shy of the PROPAGANDA we suspect that he may represent the mob that started all the propaganda in the first place.

I cannot work out a chart for that but trend seems to be up.

On topic, looks like you have called the short term gold trend correct sinner, its going down today.

cheers explod

 

[Uncle Festivus]

Gold has been selling off with the broader market with rapidly declining open interest.

Where do you get your OI data from?

http://www.cftc.gov/marketreports/bankparticipation/index.htm

(work in progress, is it available anywhere else? http://spreadsheets.google.com/pub?key=pU-CyOZ-EOdqC_X01FRv1RA)

 

[Trembling Hand]

A nice pretty chart here,

http://futures.tradingcharts.com/cotcharts/GC

 

[sinner]

Uncle Festivus, here is the numbers, fresh off your provided data, if you disagree. Column #1 is Month, Column #2 is Put/Call Ratio, Column #3 is Short Fut/Long Fut ratio.

We can usually use put/call ratio column as the "normaliser" for the short/long ratio column because most of the bank movement is done on the COMEX (futs).

Month Put/Call Long/Short Normalised (A * B)
Sept 0.56 1.74 0.97
Oct 0.62 4.12 2.54
Nov 0.58 2.11 1.23
Dec 0.56 2.63 1.47
Jan 0.56 3.48 1.94
Feb 0.47 4.14 1.93
Mar 0.53 4.28 2.26

Increasing ratio here means decreasing bank longs as a ratio of shorts. Unfortunately TH pretty chart does not highlight this massive ratio change from previous months.

Sorry if I offended you in any way Uncle Festivus, I value your postings!

 

[Trembling Hand]

Sinner can you explain your thinking. why are you using the options OI instead of the futs

 

[>Apocalypto<]

Sinner can you explain your thinking. why are you using the options OI instead of the futs

that's a normal picture at this point TH the commercials selling to the Johny come latelys. Gold really hit a wall at the 1k point.

nice chart!

 

[sinner]

Sorry TH not sure I understand you. I am not "using" anything instead of anything else? Only presenting the data as a ratio.

There are three decimal columns above: the first is put/call (options), the second is short/long (futures) and the third is the multiple of the previous two.

You can use whichever you wish

EDIT: Forgot to say good chart TH, highlights how the banks are ensuring there is enough bids on both sides for a liquid market.

 

[joeyr46]

Years since I looked at CFTC but last peak short commercials coincided with meaningful top July 15th and this peak slightly lower and slightly less OI suggests Good correction for a while (down)

 

[highonoctane]

Hi All,
Am considering buying some physical Gold and Silver/Platinum to sit on untill the share market truely bottoms and becomes tradable for an amateur like myself. The idea would be to buy more gold as my funds allow over that period.

Now I dont know a whole heap about what will potentially happen to gold or AUD in the future, but I'm reading alot of articles (on daily reckoning and other financial/economy analysis sites) recomending it.

I'm concerned, however, that the AUD might appreciate against the greenback faster that the gold will (hense wiping out any profit)

Anyone care to shed some light on where you think gold prices and the AUD will be at in a year or 2?
In your opinions, would this be a wise way to invest a few grand for example?

 

[Uncle Festivus]

Just doodling with the technicals, and does not constitute advise.

Most of us? know that gold rewards those who are patient and usually likes to do the wedgy thing in minor & major cycles, so it looked to me that it is possibly establishing the mother of all wedges in the bull so far. It would also line up with seasonal strength and weakness periods, and also a much hoped for, much hyped for, bear market rally in pleb shares, out to July/August? (Or similar to the first great depression ie dead cat bounce rally before the final capitulation?) Or things might get so bad that the $US does finally capitulate and all bets, and analysis, are off?

Which means in the short term, negative consolidation shall we say?

Failing that, anyone care for a double top?

Anyone got a more robust EW set up to concur with this?

All the while climbing a wall of worry and a bearish gold bug sentiment, disappointed that it failed at $1k -

http://www.marketwatch.com/news/story/Contrarian-analysis-current-gold-market/story.aspx?guid=%7BA6AA73CD%2D45EB%2D48D2%2D93F4%2DB86D4C5EE2AD%7D&dist=SecMostRead

 

[Trembling Hand]

All the while climbing a wall of worry

Good one. its been a while since i heard that gem.

 

[Uncle Festivus]

Good one. its been a while since i heard that gem.

I was meaning the goldies will be/are worrying this time ie gold bug sentiment is pretty low for the current price, even though the AU price is still giving local miners bonanza windfall profit margins at $1450/oz?

 

[Trembling Hand]

I was meaning the goldies will be/are worrying this time ie gold bug sentiment is pretty low for the current price, even though the AU price is still giving local miners bonanza windfall profit margins at $1450/oz?

Yeah I know what you are saying. i just mean that its a gem that I haven't heard since ........ early 07.

How things change.

 

[Glen48]

Seems to me while we have deflation no one wants to get into Gold and sitting back looking at the WOW, I did read were Norway is starting to worry about inflation I suppose it all depends what time a country goes in to a recession before inflation becomes a problem in that country.....now what colour to pain that wall so I can watch the paint dry???

 

[highonoctane]

thanks for the comments,
Have been doing a bit more research killing time at work, most analists are predicting a decline for first half of 09, so I might save my cash for a few months yet

 

[Conza88]

Gold is heading up. All commodities will.

Fiat is getting printed like crazy.