Gold Price - Where is it heading?

[Magdoran]

Hi Mag, I'm good thanks!

How are you?

The above comments were really made in regard to particular people claiming 'this stock will go to 20 cents by Friday!!!' when it's sitting on 5 on Wednesday...

I must say I am a sceptic. It seems convenient for EW/time based practitioners to just use certain stock charts that do fit in to the theory but then ignore the rest. I would like to know what % of stocks actually do follow EW or cycles. I would hazzard a guess to say very few.

I would also like to compare ALL of Yogi's predictions to see what % actually make it? I hazzard a guess not many. I know Gann's a different game, and I'm not comparing it directly with wave theories, but I just raise that as another example of certain practitioners clinging on to the few examples that fit the profile and disregarding the multitute.

I'm still trying to fit the XAO into an EW count and it's impossible. This to me would tend to suggest that as the XAO is a summary of many stocks, and it can't fit, then it doesn't work.

So, I'm sticking to probabilities on basic charting for the minute. Until I see the light!

Hello kennas,


Hey, I’m great thanks. Still waiting to see if there is a Melbourne get together mark II, but hopefully you won’t be left high and dry this time!

Ok, I can see you’re a sceptic, and I recognise this, because so am I. But I spent years researching this stuff and found people who know a lot about it. In fact I had a couple of study groups for a few years which really helped.

Sure, any market analysis is necessarily flawed, and as Mark Douglas says “anything can happen”, and “every moment in the market is unique”.

Check out the demonstration in the “Improving chart analysis” thread on Brent and light crude for an example of how this time cycle approach can work. This is actually a Gann based time cycle approach, but I certainly pay a lot of attention to wave structure as an element in the mix, but it is pattern that is paramount.

As for EW – what kind of study have you done? wavepicker is probably the most knowledgeable and advanced EW player I know, and the process is quite involved, and takes years to master (as does the Gann method). The EW style is actually very effective but in the right circumstances. Sometimes it is irrelevant or just not applicable – same for time cycles. The art is in knowing how to use these to trade. Prechter and Frost’s work is about the best I’ve seen.

Just because you can’t see the patterns and understand them, doesn’t mean they aren’t there. And sure, many apparent patterns will not work out… But the concept is to deal in probabilities and pattern recognition just like any good T/A is all about.

Go and have a look at wavepicker’s forecast, and see if you agree that it’s pretty close to what happened. Forecasting is an art. Of course the practitioner will get it wrong sometimes, and should set criteria in place to identify when this happens invalidating the pattern, and take the appropriate action. But when these are right, do the math. Imagine having a forecast well in advance and being able to trade it successfully. Imagine trading that with leverage, and you’ll get the idea of the possibilities.

Regards


Magdoran

 

[wavepicker]

Hello Kennas,

I must say I am a sceptic. It seems convenient for EW/time based practitioners to just use certain stock charts that do fit in to the theory but then ignore the rest. I would like to know what % of stocks actually do follow EW or cycles. I would hazzard a guess to say very few.

Kennas the Elliott Wave Principle is used most effectively with the most liquid markets/ stocks. Those illiquid penny dreadfalls can be a handfull to trade using any TA system. Of the liquid markets/stocks, as far as I am concerned they all follow the EWP. It's up to you to recognize the wavestructure, patterns, and probabilities of alternate counts within that instrument. The EWP in this aspect is unique in that it gives rules and guidelines to follow, making it one of the most objective of all methods. This is where most unsuccesfull practitioners fail. As with most systems, it's the lack of discipline to follow it that kills them.

I'm still trying to fit the XAO into an EW count and it's impossible. This to me would tend to suggest that as the XAO is a summary of many stocks, and it can't fit, then it doesn't work.

To the contrary, the XAO has a beautifully structured long term wave pattern, they don't get much better than this. The fact that it is a combination of many stocks and thus an excellent representation of social mood. I had some EW charts from 2-3 weeks ago, but I was unable to upload them due to file size limits. I emailed them to Swingstar, Mag, and Richkid.

As Mag has said, whether it be Gann, Elliott, cycles analysis etc, they all take years to master. I would suggest looking at realtime prices in a fast moving markets to look at specific patterns to speed up learning if you are interested in this sort of approach.

As for Gold, it has been tracking pretty well to the EW count made back in June. That was a long time ago, I am not sure whether it will continue to do so. But I will stick to this pattern until it becomes invalidated. At the moment it has not.

Cheers

 

[Sean K]

Hello Kennas,

Kennas the Elliott Wave Principle is used most effectively with the most liquid markets/ stocks. Those illiquid penny dreadfalls can be a handfull to trade using any TA system. Of the liquid markets/stocks, as far as I am concerned they all follow the EWP. It's up to you to recognize the wavestructure, patterns, and probabilities of alternate counts within that instrument. The EWP in this aspect is unique in that it gives rules and guidelines to follow, making it one of the most objective of all methods. This is where most unsuccesfull practitioners fail. As with most systems, it's the lack of discipline to follow it that kills them.

To the contrary, the XAO has a beautifully structured long term wave pattern, they don't get much better than this. The fact that it is a combination of many stocks and thus an excellent representation of social mood. I had some EW charts from 2-3 weeks ago, but I was unable to upload them due to file size limits. I emailed them to Swingstar, Mag, and Richkid.

As Mag has said, whether it be Gann, Elliott, cycles analysis etc, they all take years to master. I would suggest looking at realtime prices in a fast moving markets to look at specific patterns to speed up learning if you are interested in this sort of approach.

As for Gold, it has been tracking pretty well to the EW count made back in June. That was a long time ago, I am not sure whether it will continue to do so. But I will stick to this pattern until it becomes invalidated. At the moment it has not.

Cheers

Thanks WP, I haven't given up. I'm determined to master as many trading techniques as possible. I have a least 30 years left to do that I think. Hopefully I find something that works best for me soon and I can make it work. Thanks for the feedback. Cheers.

 

[Sean K]

Gold slipping under $620 again overnight, probably due to good inflation number out of the US and I think the $US is up a bit. While inflation is contained and $US keeps holding up I think gold is going to continue to track sideways and down. This can not happen for ever though. US is still structurally weak under mountains of debt which is unsustainable. The international markets already know this, they just need an excuse to start dumping $US and buying other currencies including gold as a hedge and safety net.

 

[wavepicker]

Gold slipping under $620 again overnight, probably due to good inflation number out of the US and I think the $US is up a bit. While inflation is contained and $US keeps holding up I think gold is going to continue to track sideways and down. This can not happen for ever though. US is still structurally weak under mountains of debt which is unsustainable. The international markets already know this, they just need an excuse to start dumping $US and buying other currencies including gold as a hedge and safety net.

Agree with your comments kennas, only prob is that could be as long as a year before this starts to happen.

Looking at the POG from a positive side however, if it does go lower to say $490 or even slightly under, then think of the buying opportunity assuming the bull was to continue.

Cheers

 

[The Mint Man]

This can not happen for ever though. US is still structurally weak under mountains of debt which is unsustainable. The international markets already know this, they just need an excuse to start dumping $US and buying other currencies including gold as a hedge and safety net

I agree, well said.

cheers

 

[Kauri]

I have plotted out the two possible ways that I see gold going in the short/medium term by applying E/W theory the way I see and understand it. Do any Ellioticians (sorry Rich ) see it this way or are able to show me where I've gone astray. Much Appreciated
Thanks...

 

[ducati916]

Re: GOLD Where is it heading?

Not asking you to buy gold as I am happy to do that.
But would you like to do another of your detailed analysis so that we can see what range prices for gold we can look forward to over the next year or so?

Or would you prefer a brief history lesson: Recall my challenge to you -


And one of your multitude of sweeping conclusions:

In the light of the fact that gold has breached your preferred upper range of $720 I think it only fair to give you another opportunity to prove yourself. On the other hand, I will concede utter defeat if gold’s “parabola” collapses and by year’s end POG is trading under $800 (which I believe is generous in that my expectation was for gold to be near that level by year’s end, rather than be as “support”).

For the moment, I am hoping for another $50 or greater retrace in gold near term, but will not hold my breath: Corrections in the metals complex as a whole are running to about 3 days instead of 3 weeks or more.

Wayne
I will put you into ducati’s camp. Do you recall an earlier post where you mooted a $500 correction and I replied:



My concluding remark for now is that playing the markets means taking a forward view, and that view can be based on your decision to trade a safe “yield” equity, or a highly speculative futures contract. You enter the trade with a “view”, never a “knowledge”. Posting that “view” can mean a loss or gain of “reputation”, but in the case of ducati, he has my respect for at least trying to work out gold: A little knowledge can be a dangerous thing.

Well we are currently half-way through November, and drawing close to years end and gold is still a fair way from $800oz, in fact, it's a fair distance from $700oz.

jog on
d998

 

[chicken]

read what is said on www. thebulliondesk.com what the expert are saying...its ALL good news for GOLD buffs.....US$$ are in decline....and with Russia and China going for Gold....sounds like the olympic games....US $ is going down.....read it for yourself......

 

[GreatPig]

Would that be the experts who went to the same school as this one?

"Stock prices have reached what looks like a permanently high plateau. I do not feel there will be soon if ever a 50 or 60 point break from present levels, such as they have predicted. I expect to see the stock market a good deal higher within a few months." - Dr. Irving Fisher, Professor of Economics at Yale University, one of the most important US economists of his day, speaking on October 17, 1929, a few weeks before the Great Crash.

GP

 

[ducati916]

read what is said on www. thebulliondesk.com what the expert are saying...its ALL good news for GOLD buffs.....US$$ are in decline....and with Russia and China going for Gold....sounds like the olympic games....US $ is going down.....read it for yourself......

Most foreign governments have a large stake in maintaining the US trade deficit, and thus, a strong dollar. Thus Central banks keep accumulating dollars.

The practice of buying dollars for this purpose is reinforced by a further very important consideration, and that is the ever increasing needs of the worlds markets to transact in a single currency.

That currency is the US$.
Once a currency achieves this status, it is very difficult to unseat the King.
Currently, the US$ accounts for 88.7% of all transactions. This drives the requirement for an ever expanding supply of dollars [read increased demand] thus maintaining the dollar strength.

Thus in this context, what does that say about Gold?

jog on
d998

 

[Spot]

Commercials seem to be adding to their SHORTS

 

[Spot]

Present UP move without support ?
two dn weeks on low vol ?
weekly chart

 

[Kauri]

Present UP move without support ?
two dn weeks on low vol ?
weekly chart

Spot, am I missing something here, that chart looks like the May 2004 chart??

 

[Spot]

Sorry !

Here's the correct Chart

IMHO
Still the same picture -- UP move without support
This weeks DN with low Vol may be very S/T bullish

 

[Spot]

Just a alternative indicator

Theory being POG is a Liquidity Indicator , hence leads the banking sector .

POG can track GS - NY for a considible period of time

If the EW counts are right then GS will hit a high of around $190 , then commence a A,B,C decline

The attached charts show that this may be in the making now

 

[ducati916]

A Hedge Fund managers perspective;

The illusion of a liquidity fest is juicing the market, but the more likely reality is that we've got a derivatives/credit/lending mania in full force. How can you protect yourself? Think gold.

By Bill Fleckenstein
The only thing better than good news these days is bad news. Twisted logic, but it's the unmistakable mindset on Wall Street, as last Tuesday's action demonstrates.

Never mind Home Depot's (HD, news, msgs) quarter, which was much worse than expected, or the lowered guidance from both Home Depot and Wal-Mart Stores (WMT, news, msgs). It was an up day for the shares of those two companies, whose $450 billion in sales together constitute just shy of 5% of our nation's gross domestic product.

Bulls ignoring bellwethers
Tuesday proved to be a fine day for the market overall, as folks digested as "good" a comment by St. Louis Fed chief William Poole -- which was that the housing market, that fabled engine of our economy, may worsen yet. In any case, this kind of action is the hallmark of markets that want to go up. Although, in this case, it's quite possibly a sign of the complete drunkenness that's seen in the late stages of market advances, i.e., tops.

As someone who continually tries to make sense of all the motion -- some of which may be noise, but one never knows -- I was thus fortunate to discuss the current environment with Marc Faber, the editor of the Gloom, Boom & Doom Report, over dinner last week.

He kept coming back to the same point, which may explain why our equity market levitates in the face of deteriorating fundamentals: Essentially, the money is "no good." We print it at the speed of light and the drop of a hat.

Liquidity: Not the mother's milk of a mania
Part of me thinks that the current mini-mania in equities is a response to Fed-induced liquidity. And yet, when I discuss with my good friend Jim Grant what the big central banks of the world are doing -- Japan's, the United States' and Europe's -- he suggests that they really aren't spewing out liquidity as aggressively as people think. Of course, if they were, one might expect commodities to be on more of a run than they have been. To me, they seem to be suggesting that the world economy is slowing down at the margin.

Therefore, I've concluded that what we may have is the illusion of a liquidity fest. The stock market is acting as though there's an enormous fire hose of liquidity gushing forth -- when, what might actually be the case, is that a wanton derivatives/credit/lending mania is in full force.

Markets in motion may stay in motion. If, however, the source of the propulsion is mispriced and badly structured credit, things can come to a sudden stop. But if that were to occur, the Fed at some point would ride to the rescue with plenty of liquidity. That is Marc's point and is, of course, the point of my pet saying that in a social democracy with a fiat currency, all roads lead to inflation.

Metallic immunity to central-bank meddling
In terms of what conclusions Marc comes to: The easiest way to protect oneself from this money printing is to own gold. No matter how you examine the milieu, it seems that all roads lead back to gold.

Marc is convinced that gold and silver will go dramatically higher in the next few years. He expects that when the world's central banks are forced into a real print-athon, gold will truly explode. And the more they drive up the financial markets via their efforts -- that is, if they can drive up the financial markets -- the faster gold will go up. In other words, he believes the bear market in stocks, relative to gold, will continue and that it will accelerate the more that authorities attempt to fight it.

Mighty aches from little manias grow
Back to our stock market, I believe that it's in the throes of a manic blow-off, rather than signaling the start of some long, sustainable trend, as in 1991 and 1995. This has been my view for a while, though so far, it has proved incorrect, and that may continue to be the case for a bit longer.

Nevertheless, when I look at the environment, it quite frankly scares me because all I can see is a disastrous ending to this party. (Though I've reduced my short exposure, I can't bring myself to take it too low, due to the feelings I just described.)

As to what will bring about the demise, I suspect it will be sheer exhaustion, but it could be any number of events. As to when the party might end, there's no way of gauging that. Nor is there any way of gauging, when a market gets this out of control, how high is too high.

But the important takeaway point: If the environment is as I suggest, it can end quickly and violently. Those who are tempted to participate are likely to be hurt. That's my best attempt to make sense of what's going on and what it may lead to.

jog on
d998

 

[Spot]

d998


Have been stewing over the same type of view.

Come up with holding the physical in it's various forms only.

If one of the main reasons for holding gold is inflation, then surely any margin the miners make is going to be wiped out by rising costs (juniors excepted)

The time to be getting into the major/mid cap miners is probably over and time to start accumalating the physical on major dips is here.

 

[Sean K]

Gold rises on eroding dollar

MONDAY, NOVEMBER 20,
SINGAPORE: Gold rose for the second day amid speculation that the Federal Reserve may not raise interest rates further, eroding the value of the dollar and boosting the bullion's appeal as an alternative investment.

Gold for immediate delivery rose as much as 3.08 dollar to 624.78 dollar an ounce while Gold futures for December delivery rose 1.80 dollar to 624.30 dollar an ounce on the Comex division of the New York Mercantile Exchange in after-hours electronic trading.

A housing slump in the US may discourage the Fed from changing its overnight lending rate, after two years of increases to 5.25 per cent, according to analysts survey.

Holding above $620 still. I'm still on the fence which way it's going short term. Wating for that magic break through $640 which will be the start of the bext bull IMO.

 

[wayneL]

Come up with holding the physical in it's various forms only

Do you mean the stuff that jingles in your pockets or one of the various proxies, e.g. ETFs?