Gold Price - Where is it heading?

[Porper]

I closed my longs at the last peak - so I take it you are buying US equities at these levels?

No, I have just moved to 90.0% cash...I am not clever enough to buy at the exact bottom and sell at the absolute top. But then you don't need to as you know.

As for the U.S I am sure they will be able to put doomsday off for a lot longer than people imagine. Decades as opposed to a year or two. Despite what the "Do It Yourself Economist" thinks the world economy won't be allowed to collapse. There is always a way to put off the inevitable. Don't know what it is but this is the reason I don't comment on fundamentals...there are far cleverer people in key positions than us Uncle.

 

[Garpal Gumnut]

No, I have just moved to 90.0% cash...I am not clever enough to buy at the exact bottom and sell at the absolute top. But then you don't need to as you know.

As for the U.S I am sure they will be able to put doomsday off for a lot longer than people imagine. Decades as opposed to a year or two. Despite what the "Do It Yourself Economist" thinks the world economy won't be allowed to collapse. There is always a way to put off the inevitable. Don't know what it is but this is the reason I don't comment on fundamentals...there are far cleverer people in key positions than us Uncle.

I was 90% cash at 10am this morning, now heading in to XAO.

I agree about Gold.

Much pain awaiting for Gold holders imo.

gg

 

[Uncle Festivus]

...there are far cleverer people in key positions than us Uncle.

90% cash is hardly bullish??

It's the 'clever' people who got us into this mess and don't have a clue how to get us out of it. Bernanke himself admitted that they didn't know why rates were rising now. The really clever ones are entrusted with facilitating the machinations behind the scenes.

Back on topic at least, there is a bullish ascending triangle looking to break out above 1260.....?

 

[Porper]

90% cash is hardly bullish??

It's the 'clever' people who got us into this mess and don't have a clue how to get us out of it. Bernanke himself admitted that they didn't know why rates were rising now. The really clever ones are entrusted with facilitating the machinations behind the scenes.

Back on topic at least, there is a bullish ascending triangle looking to break out above 1260.....?

Not bullish stocks medium term at all, despite the latest rally. It's all about time frame. As for Gold a Fib cluster has been hit on the weekly chart (can't post a chart here) but looking for a bounce only. A major bottom not in i.m.o.

 

[Uncle Festivus]

A major bottom not in i.m.o.

What is your 'target' for the bottom & why?

 

[Porper]

What is your 'target' for the bottom & why?

Some stopping volume at the end of June on this weekly chart but hardly bouncing hard. A messy rally up to 1300 -1400 implies another move down to the 61.8% retracement level around 1000 which should take until well into next year to unfold.

It would take a break above 1420 to suggest the larger correction has completed. Not likely.

All technical and fundamentals ignored.

 

[notting]

That would be good because we can then look forward to this:

http://www.cnbc.com/id/100874899

Being careful no to miss the boat!

 

[Uncle Festivus]

Well that wasn't a surprise - no taper?


get

GOFOr it?


Scramble?

 

[CanOz]

Gold has retraced to the previous bracket (value area). Price can get rejected here, accelerate through, or bracket and then decide....

 

[Intrinsic Value]

Gold has retraced to the previous bracket (value area). Price can get rejected here, accelerate through, or bracket and then decide....

Thanks for the in depth analysis in other words you dont have a clue where the POG is going just like everyone else

 

[CanOz]

Thanks for the in depth analysis in other words you dont have a clue where the POG is going just like everyone else

Of course i don't, I'm not a fortune teller IV...

Analysis, fundamental or technical only presents the possibilities. I'm not offering a trade opportunity, only suggesting that the price is heading into the bracket area. Now if you wanted a trade opportunity you would watch the price action and see how the limits of the bracket area are tested and whether or not responsive buyers/sellers are found there. It a area where value was accepted before, that makes it relevant NOW.

Enjoy.

CanOz

 

[MARKETWINNER]

http://www.forbes.com/sites/kitconews/2013/07/11/gold-prices-could-still-correct-50-rogers/

Gold Prices Could Still Correct 50%: Rogers

 

[explod]

By who? Argue the facts and figures... I showed you the facts. They say that is utter rubbish. Are you not worried that you have based your wealth on a myth????



"Is said to be"........hahahahahahahahha

"Most purchasers of 'gold' in foreign exchange markets," Naylor-Leyland writes, "have no physical backing to their trades (estimated to be around 90 percent unallocated). This is the nature of the OTC 'gold' currency market. Considering that most people invest in gold exactly because they fear the fractional-reserve nature of the banking system, this is a bizarre state of affairs and I believe has led us to the widening backwardation we now see as the new 'normal.'

"What is happening now is that the absolutely inevitable 'run' on the 100:1 leveraged bullion banking system is truly underway. The bullion banks want to get gold back into contango and stop the movement of the remaining inventories by shaking the market lower, using paper leverage to do so. It hasn't worked. Indeed more and more investors are now seeking allocation, delivery, and physical metal at the expense of synthetic products offered by the banks. The squeeze we have been waiting for is closing in; it is always darkest just before dawn."

http://www.gata.org/node/12793

 

[Uncle Festivus]

"Is said to be"........hahahahahahahahha

Stress in the Gold Market

The following interpretation of gold backwardation rests on a few assumptions.

- The participants in the London bullion market act like banks. They borrow and lend both US$ paper currency and gold, but they are not primarily long or short gold versus US$. They do not primarily speculate and do not engage in proprietary trading. (This is why they are called bullion banks. They are institutions that lend and borrow gold and silver. Some of them have a commercial banking license, but some do not.)

- Their physical gold is fractionally reserved, i.e. they lend a certain multiple of the actual physical reserve by creating ledger entries for gold. These are the unallocated gold accounts.

- Because of the fractional reserve lending, the participants in the bullion market are prone to a classic run on the bank, i.e. a run on the physical bullion reserve. This happens when the depositors who hold gold in unallocated accounts wish to take possession of the physical bullion and request allocation, while the bank cannot recall their gold loans quickly enough in order to get hold of the physical bullion they have lent to somebody else. A previous article contains some sample balance sheets in order to illustrate how this works.
In the case of such a run on the bank, the bullion bank needs to borrow physical gold in the market for the period between the day on which the customer withdraws physical gold and the day on which an outstanding gold loan is repaid in physical gold.

One way of borrowing gold from the market is to swap US$ for gold, i.e. borrow gold and lend US$, in the LBMA forward market (In this swap, the borrower at first receives the gold as a credit to their unallocated account, but they can immediately request allocation, take possession of the physcial and deliver it to the customer who wanted to withdraw physical gold). The interest received for such a swap is GOFO. If, however, the bullion banks need to obtain large volumes of such swaps under pressure, this will drive down GOFO, possibly rendering it negative so that the bullion banks have to pay interest in order to borrow gold against a US$ collateral. This is a plausible explanation for the downward spikes in GOFO seen in Figure 1 above, some of which have sent the gold forward market into backwardation.

Another option is to borrow gold for US$ using the spot and futures markets by purchasing gold in the spot market and at the same time selling a futures contract, for example at the New York Commodities Exchange (COMEX). The signature of bullion banks borrowing gold from the market is then buying pressure in the market for physical gold plus an increasing short position in the futures market, possibly causing backwardation at the COMEX. Gold bugs often interpret this as outright market manipulation, but it may just be some bullion bank borrowing physical gold from the market for a fixed period of time.

Straight from Victor The Cleaner......

Stress?

http://www.lbma.org.uk/pages/index.cfm?page_id=55&title=gold_forwards&show=2013

08-Jul-13 -0.06500 -0.04333 -0.03000 0.03500 0.18167
09-Jul-13 -0.10600 -0.08400 -0.07000 -0.01000 0.13800
10-Jul-13 -0.11167 -0.08000 -0.05833 -0.00167 0.14000
11-Jul-13 -0.05167 -0.02833 -0.01500 0.04667 0.15833
12-Jul-13 -0.04167 -0.02333 -0.01333 0.06167 0.17000
15-Jul-13 -0.05500 -0.04000 -0.02333 0.06167 0.18500
16-Jul-13 -0.05667 -0.04333 -0.02500 0.06333 0.18833

Reaction?

 

[Uncle Festivus]

http://www.reuters.com/article/2013/07/19/derivatives-gold-idUSL1N0FP1CB20130719

July 19 (IFR) - A dislocation in the gold futures market indicating that demand for physical delivery of the metal is now far outweighing supply has intensified in recent weeks, increasing concern in the market that the change may not be a momentary blip and participants may have become over-leveraged.

Gold went into backwardation in comparison to the three-month futures contract in early January, meaning the spot price rose above the short-dated future contact. Now that process looks set to creep out the futures curve to longer-dated maturities, signalling some cause for alarm.

"The fact that has remained and widened ... indicates that the physical market has tightened up substantially, a postulation that is corroborated by the growing premiums being paid ... and the ongoing wholesale delays in the delivery of substantial bullion tonnage," wrote Ned Naylor-Leyland of Cheviot Asset Management in a report this month.

"What is happening now is that the absolutely inevitable 'run' on the 100:1 leveraged bullion banking system is truly underway."


COMEX Registered Gold Falls To Another New Low Ahead of Option Expiration and August Delivery

http://jessescrossroadscafe.blogspot.com.au/2013/07/comex-registered-gold-fall-to-another.html

Nick of Sharelynx.com does a rough calculation of the open interest/registered or dealer's gold. The number of owners per ounce is up to a bull market high of 46 claims for every ounce registered as deliverable.

 

[Uncle Festivus]

.............the failure to imagine something outside assuredly comfortable perceptions of systemic reality.

http://www.realclearmarkets.com/art...gold_obsession_is_wholly_rational_100487.html

 

[Uncle Festivus]

As for the U.S I am sure they will be able to put doomsday off for a lot longer than people imagine. Decades as opposed to a year or two. Despite what the "Do It Yourself Economist" thinks the world economy won't be allowed to collapse. There is always a way to put off the inevitable. Don't know what it is but this is the reason I don't comment on fundamentals...there are far cleverer people in key positions than us Uncle.

Decades? I am reminded of this post every day I see things that say that the GFC is definitely not 'contained'.

'the world economy won't be allowed to collapse'?

'There is always a way to put off the inevitable'? Not for Detroit at least, and several larger munis and cities next on the Big Bankruptcy Express....the real 'recovery'?

• Philadelphia: 5th Largest City in US is Effectively Bankrupt; Mayor Holds Closed Meeting With Wall Street to Discuss Asset Sales
• Houston: CPAs state Houston is Bankrupt
• LA: Mayor of Los Angeles Says "Bankruptcy is Not an Option"
• New York Cities: Public Pension Ponzi Scheme - New York Cities Borrow From Pension Plan to Make Contributions
• Baltimore: Time for Baltimore to "Pull a Vallejo" and Declare Bankruptcy
• Miami: Miami Commissioner Says Bankruptcy is City's Best Hope
• Chris Christie Says New Jersey Careens Towards Becoming Greece
• Chicago: Chicago's Mayor Daley Discusses Bankruptcy For City Pensions
• Scranton: Scranton Mayor Slashes All Public Worker Wages to $7.25 per Hour, Including Police, Fire, His Own; City Effectively Bankrupt
• Harrisburg: Pennsylvania State Capital Files for Bankruptcy
• Zombified Cities Roundup: Detroit Becomes Dumping Ground for the Dead; Financial Urgency in Miami; Oakland Pension Time Bomb; How Pensions Crashed Stockton and San Bernardino

"Do It Yourself Economist" - it doesn't take much to better a graduate economist ie simply making 1+1 = 10, when the real world knows it has always = 2. And very soon it will revert back to = 2, but perhaps not before = 0?

.............the failure to imagine something outside assuredly comfortable perceptions of systemic reality.

1320...................

 

[Intrinsic Value]

.............the failure to imagine something outside assuredly comfortable perceptions of systemic reality.

http://www.realclearmarkets.com/art...gold_obsession_is_wholly_rational_100487.html

Cut through the economic jargon and what you get is that many people dont trust bankers one bit and especially bankers who print money ad infinitum and employ other dubious economic stategies to try to manipulate the POG downwards.

Gold has long beens seens as a hedge in many of the emerging countries through SE Asia, and has always had a big following in the Middle East and India and of course when the going gets tough there has always been a flight to gold.

 

[Trembling Hand]

Cut through the economic jargon and what you get is that many people dont trust bankers one bit and especially bankers who print money ad infinitum and employ other dubious economic stategies to try to manipulate the POG downwards.

Err.... what "dubious economic strategies to try to manipulate the POG downwards" and doesn't printing money cause hard assets to rise in price?

I think your thesis here is a little 180 ar$e about!

 

[Accumulator]

up towards $1700