"Heavily Overbought" Gold & Silver Due for a Major Fall
Gold has fallen sharply in recent days, but its supporters are undaunted: The yellow metal remains within earshot of its all-time high and is destined to soar as the dollar implodes, gold's bulls say.
As is often the case, Bob Precther, president of Elliott Wave International, takes the contrarian view, arguing there's "too much optimism" about precious metals and negativity around the dollar.
In fact, Prechter believes the dollar put in a major bottom last week and, as a result, foresees major weakness ahead for commodities generally, and gold and silver specifically. The precious metals are "heavily overbought" and the "path of least resistance" will be to the downside for many months, he says. "[Gold's] going to go much further [down] than people think."
Prechter predicts gold will follow silver's path, which has put in a series of lower highs in recent months.
"Even though people are one-sidedly bullish on precious metals, they're not making any progress at all," says the legendary market watcher. "I would not be loading up on gold at this point, you'll get a better opportunity later.
output
I Expect A Major Dip
And if you're a "trader" it would be wise to act accordingly. Ultimately I expect PM's to go higher. When this will be is impossible to predict with precision, although many will try.
I'm not interested in day or even short-term trading. I buy on the dips as an inflation hedge. It is NOT an investment, although many refuse to recognize this.
_____________________________
"Make the lie big, make it simple, keep saying it, and eventually they will believe it." -- Joseph Goebbels
An in-depth look at gold trading during the recession.
Gold: unstable metal
By Chris Flood, Alistair Gray, Helen Warrell and Steve Bernard
Published: May 6 2009 18:43 | Last updated: October 9 2009 16:42
Bullion prices are famously volatile – they rose dramatically in the 1970s as the US ended restrictions on private gold ownership and fell just as sharply in 1999 on the announcement that the Bank of England was to sell its gold reserves. The current financial crisis has seen further fluctuations as buyers have rushed to acquire gold as a safe haven but also sold the precious metal to cover losses in other markets.
Click on the timeline points below to see which economic and political events have driven the gold price from 1900 to present day, and expand the red shaded area for an in-depth look at gold trading during the recession.
http://www.ft.com/cms/s/0...
Draw your own conclusions my friends, and you too bad_karma. The more the FED keeps it near-zero rate policy alive, and the more likely this new asset bubble is to burst. And when this current bubble does burst, we'll see another huge dollar rally and the price of gold drop. I stand by my predictions.
when the price of gold was
when the price of gold was set by the government till Nixon closed the gold window what did gold do? what happened to gold From 71 to 79.. what has gold done from 2000 to 2009? you missed the boat...
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
this is why gold is not in
this is why gold is not in an "asset" bubble.
I found no one - not one person - who is actively investing in anything gold or silver, let alone rushing to buy or hoard the stuff. I had two people who confided that they did own gold, but in both cases it was inherited. A few were curious how they would go about doing such a thing, and fewer asked if I thought they should. Most everyone looked at me blankly when I asked; they didn't seem to know what I was talking about. When I got a reaction like that, it was pointless to ask about gold stocks. Of the handful I did ask, most had never heard of Barrick Gold, the world's largest gold producer.
Now ask yourself the same thing: how many of your family, friends, neighbors, and co-workers are buying gold and silver coins? Are any of them giving you hot stock tips about a fantastic gold producer, or telling you about the latest gold discovery made by a company in China? Have any fellow investors told you they're dumping their brokers because they can select gold stocks better on their own? Anyone telling you they're going to night school to learn the gold mining business?
Next, I surveyed a large sampling of print media looking for some of these signals that Bert surely had spotted. Over the past couple weeks, not one of the major business magazines I reviewed had anything on the cover about gold or silver. Further, there were no articles on precious metals, such as the best ways to buy or store all this gold everyone is buying.
http://www.321gold.com/ed...
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
ooookkkkk it is not an
ooookkkkk it is not an asset bubble... if you comparing the housing bubble to gold you are crazy.. and just exactly what is a huge dollar rally?
.79? so you must be thinking the economy is going to improve for the fed to start raising rates correct?
prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Ok then bad_karma,tell us why
Ok then bad_karma,tell us why you don't you feel that the Dollar's new role as the currency of choice for the carry trade is either causing now or will at some point cause another asset bubble to collapse when the FED signals a change in near zero rate policy?And if so, do you don't believe as I do that there will be another round of unwinding of those carry trades that causes an unwinding of these trades causes another large dollar rally and a drop in all other asset classes.
having your own currency be
having your own currency be the carry trade currency is not a good thing.
it is a sign of problems.. Your premise that this will lead to a gold bubble burst is assanine.. it goes to show you have no clue about what is really going on... by the way gold just hit 1100.50.. thought you would like to know... now some reading for you....
The price performance of gold recently has all sorts of armchair economists ( SEE JEFF3456098) waxing philosophical on the idea that this is the advent of a price “bubble”. While certainly everyone has and is entitled to their opinion, there are other features of humanity that we all possess, and much like many opinions, are best obscured from view.
Declaring that gold is in a “bubble” demonstrates complete ignorance of or disregard for the fundamental drivers of the almost ten year ascent of gold. And saying that the price is forming a bubble implies that, like the real estate bubble, the tech bubble, and the tulip bubble, the price must necessarily “pop” and return to a sustainable long term average.
read the rest and get an education here...
http://www.kitco.com/ind/... this article describes you pretty good.
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Dear Mr. Jeff34761, Mr. Flood, Mr. Gray, Ms.Warrell, Mr.Bernard.
If I told you, you were being tricked about the real value of money your whole life would you believe me?
Probably, like millions of others, no !
I beg you to try to change your perspective on Fed issued I.O.U. notes the Fed calls money.
To measure anything accurately, including the value of money, one must have an accurate fairly simple measuring devise or scale.
For centuries Gold has been the basic measuring device for money all over the world.
The writers wrote: "Bullion prices are famously volatile"!
I and most Gold hearts around the world would disagree.
The amount of I.O.U.'s { FRN's } it takes to buy Gold is what is volatile, because the amount of I.O.U.'s it takes to buy Gold fluctuates wildly with different economic conditions.
Example : I earned my first 1 ounce Krugerrand in 1996. I can exchange this Krugerrand for most currencies in the world, in fact if I was ever able to go to Dubai I could exchange it at certain places for jewelry, food, possibly clothes or any other thing that a merchant would sell me in exchange.
Now in 1996 my Krugerrand was valued at about $400 U.S.
If I had kept 4 crisp new $100 bills in a safe place since 1996, and carried the same bills to Dubai along with my 1 ounce Krugerrand, you tell me what would buy more goods, products, or services?
A guess.
My Krugerrand would buy the same amount it would have in 1996, while my still crisp new 4 hundred dollar bills would buy about 3/8ths of what the Gold Krugerrand would buy.
A change in American money is being talked about widely, and very few Americans will understand what honest money is, unless us D.P.ers are able to educate them.
Please think about this and thank you for reading.
Prechter's Predictions
They have not come true because they are based on false premises, in my opinion.
The price of gold does not depend on interpreting squiggly lines on charts, and counting bumps on graphs.
The price of gold is manipulated in the short term by major players in the market, but the long-term trend is too powerful for any of them to control.
The die is cast. Fiat paper money has always failed after 3 or 4 generations. We are nearing the end of a long run.
We are moving into a period when gold will be increasingly seen as necessary as the backing for currency.
Recently the IMF has been threatening to sell upwards of 400 tons of gold, and the market has been moving sideways, expecting the sale to restrain further upward movement for some time. Now today it is revealed that India already bought half the amount, 200 tons, LAST MONTH. For all we know, other eastern nations are buying the rest. My suspicion is that they are getting rid of a few US Dollars obtained in international trade and buying the gold, before the dollar slides further.
And that is the reason why Prechter is wrong, in my opinion. We are entering an age when gold will again be money, or at least when it will be used as the backing for currency. Under that model, the sky is the limit in terms of the price of gold and silver.
The gold market is being manipulated
But they can't control all the commodity metals. Steel, aluminum and copper are usable commodities whose value is partly measured by their usefulness to business and the pubic.
Prices are driven by supply and demand on both sides of the trade. Cheapened money (increased supply) will drive prices up. Reduced Supply of a metal will drive prices up. Increased Demand for a metal will drive prices up.
The one thing I have learned form Paul, Schiff, Woods, Rockwell and dozens of other past and present is that the money supply is always increasing under the Federal Reserve. This is a known problem. So the Federal Reserve has developed an army of disguises, traps, deceptions and gotchas to cover up the original fraud of fractional reserve banking.
With an inflationary monetary policy wages always lag behind prices. -JKGalbraith
Ron Paul for Speaker of the House 2010
Remember Oil?
Of course gold is going higher. Everyone believes it will. Just as everyone assumed oil was destined to go to $200 a barrel. The arguments during the time were equally as persuasive and logical. Well, financial markets don't care about human rationalizations, they have their own nature. The attractive force of the crowd is almost irresistible,, and unfortunately, bad for one's financial health as well. The only solace comes from knowing that when you're wrong, you're not the only one losing money.
But oil demand has crashed
The sanctions on Iran is in part designed to reduce the flow of crude. Or redirect it to more expensive sellers.
Ron Paul for Speaker of the House 2010
hey jeff save your breath we are not stupid here
eom
yes you will get a better oportunity later at 1500 and oz
eom
elliot wave are morons i read the book
and his bullshit he has been calling for a drop in gold since 2002 when it was 350
Gold Manipulation
There are major foces at work manipulating the price of gold. I actually buy into the theory that gold will be allowed to go up high in Dec Jan and then be manipulated down again.
Either way I am not using logic to determine or guess the price of gold.
No matter what I am holding and looking for dips. I am not hopeful that I will ever see the dps again.
I love it
When you guys dig up these old threads.....Funny!
lol dont believe the hype
GOLD TO 2000
The rise in gold will
The rise in the price of gold will correlate with the collapse of the dollar, which any rational-minded individual must concede is a foregone conclusion.
Yes and Then Some
Once gold and the dollar settle thier differences then I think gold will really take off against everything else as it finds its true price.
I think the current price is set purely by the dollar. After that watch out.
Did Anyone ever think That Robert Precther,,,,
*
,,,,Just may be a paid dis info agent of the current corrupt banking mob?
Yes
I have wondered that myself. I've seen him stick up for the FED. In fact when I saw that, it was in 2007 and I was done with him at that point.
No..... I think Prechter
No..... I think Prechter will be proven right as far as how bad the economy will get... he just misses the boat on Gold and silver... He looks at the US as the only people who buy gold and silver.. that is untrue.. what really baffles me about him is this... 4 to 6 billion ounces of gold in the world.. 6 billion people on the planet.. is one ounce or less of gold enough for each person... then subtract what the central banks and nations have it is even worse.. then look at silver.. there are only 1 billion ounces of silver.... the Chinese told their people to start buying.. the Chinese governemnt will not lose face toeir people by having them buy 1.050.00 gold only to see it drop to half of that... I'm not saying it couldn't happen.. actually I would love to see 10.00 silver again.. but we will see.. the big banks who short the paper market in naked futures contracts are getting squeezed... watch this...
http://www.kingworldnews....
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
i think he could be right.
i think he could be right. Gold today is at 1070 and silver is at only 16.60. Last week gold was 1050 and silver was 17.70. Isnt it obvious that demand is driving gold prices at the moment. Sometime it will have to stop and go backdown but then sky rocket again.
i think he could be right.
i think he could be right. Gold today is at 1070 and silver is at only 16.60. Last week gold was 1050 and silver was 17.70. Isnt it obvious that demand is driving gold prices at the moment. Sometime it will have to stop and go backdown but then sky rocket again.
I think so especially
I think so especially foreign demand.. I am sure at some point they will get the price knocked down.. the 2 big banks jpmorgan and goldman sachs are losing their butts right now with the short contract position they have.. it is pure manipulation. they have been doing it for decades. now tho China is on the opposite side.. they know how to break these guys.. take away the physical metal and the shorts get squeezed.
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
when this prechterite BS
when this prechterite BS post was written, Gold was around 935.00 per ounce.. not 2 days after this was posted gold went on a tear.. we have just hit 1080.00 a new record.. Gold is trying to tell us something.. there is something very wrong and the people in the know are buying.. even today with the dollar gaining .50 basis points gold has been up as much as 25.00.. jeffrey.. wrong then.. wrong now...
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
wrong then... wrong now
wrong then... wrong now lmao... wrong on everything.. how are those interest rates doing?
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Gold is up 10% since this
Gold is up 10% since this recent video.
What he didn't mention is that when gold was 250 and "no one was interested," he was predicting 200. How did that work out?
No, I disagree. There is no stopping the increase of the
precious metals now. No way Jose. The cat is out of the bag now. Too many know about the Fed hearing last Friday. They know they have been loaning endless amounts of 'debt' to banks in Europe who in turn buy U.S. treasury bills that in affect artificially pumps up the dollar. Our dollar is a big fat fake. Its not worth anything and it hasn't for years. Haven't any of you learned anything from Dr. Paul?
They simply cannot sustain this very, very stressful plugging up the holes. Its all coming down. I give it a few months.
the author of this post goes
the author of this post goes against Ron Paul in everything... well maybe not foreign policy but in economics he is against ron paul in every way.
wether it is Gold, inflation/deflation.. you name it.
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Just a couple of points
1. The original date of this post was August 2009.
2. The abandonment of the dollar as a global currency peg was not fact then.
3. Our founding fathers saw fit to make our currency gold & silver.
I'll stick with gold & silver - thank you very much.
Detective Krum Investigates:
http://victory1project.wo...
http://politicaltrackingn...
Again, for Anyone who Missed it:
http://www.itulip.com/ima...
--------------------------------
"the only thing that keeps the banking system from failing is general ignorance about how the banking system works."
----------------------------
dead banksters
http://www.dailypaul.com/...
lmfao!!!!!! thanks E....
lmfao!!!!!! thanks E.... jeff34560987?
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
It feels like the world has
It feels like the world has the gold bug. Even the globalists are saying that if there is a new reserve basket of currencies that there would have to be at least 50% of it back by gold.
lmao... heavy fall to new
lmao... heavy fall to new highs... the ultimate contrarian position is to do the exact opposite of Jeff12345609897... lmao.. ready for a fall.. so instead we go to a new high of about 130.00 higher... kinda like interest rates were going to rise a year ago and GOLD IS A FIAT CURRENCY!
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
UK Tele: Gold hits six-month high; Video and story
Gold prices have reached their highest level since February on strong investment demand amid caution ahead of key US payrolls data.
http://www.telegraph.co.u...
Published: 8:53AM BST 04 Sep 2009
The price hit an intra-day peak of $992.55, which marked the highest price since February 24. It was at $989.10 an ounce at midday in America, against $976.60 an ounce late in New York on Wednesday.
US December gold futures were up $10.70 at $989.20 an ounce on the Comex division of the New York Mercantile Exchange.
Fears that US payrolls data may disappoint sparked a flight to quality among investors on Wednesday. The metal broke out of its previous $930-$960 range as a move through technical resistance above $960 sparked a rally.
Bill O'Neill, managing partner of New Jersey-based Logic Advisors, said asset-diversification demand for gold and other precious metals by jittery investors amid shaky equities markets had propelled gold's rally.
More:
http://www.telegraph.co.u...
I would personally welcome a drop....
I'd buy like there was no tomorrow.
BTW, I checked the calendar... tomorrow looks iffy...
I may not know the truth, but I know when I'm being lied to...
LastAmerican: Check out APMEX.
They are having a silver sale: 0.59 over spot for rounds and their gold prices are as low as $9.95 over melt even with numismatic BU coins. Anything under or close to $1k per ounce of gold is not bad these days.
I have bought a lot from APMEX, and they are excellent.
Metals MUST go...up & down...for the "traders" to profit !!!
There is NO "true price" NO real price for gold or silver, only "THEIR" price.
Discover Costa Rica
Gold
Gold has gained over 5% since this article was posted. Along about that time, I was suggesting a break-out to the upside of the pennant formation that had developed. That happened. Gold has yet to blow through its all time highs around 1000. (It reached a high as 1032 for a few minutes in May '08, and has revisited the 1000 area four times now.)
One thing I mentioned as positive for gold was the fact the etf GLD was under selling pressure relative to the spot market, which I counted as a positive for gold. You can tell by tracking the physical gold flows into and out of GLD here: http://www.spdrgoldshares...
I also mentioned the very low lease rates on gold, but with decent contango, as a positive for the spot price.
That was then. This is now.
Points To Ponder
1)The future offered price of euros has sky-rocketed relative to spot. If you want to contract to buy euros a few months out, they will cost you about $1.48, whereas you could get them today for under $1.43.
2) Lease rates on gold out to three months remain negative, and the contango is still sufficiently steep, echoing the LIBOR yield curve.
3) Wiggle-watchers could argue that gold has reached the neckline of a very ragged reverse head-and-shoulder formation.
4) On Sept 3, GLD had to buy more physical metal, indicating that GLD buyers were aggressively hitting the offer price on Friday the 3rd, whereas they bears were forcing GLD previously. Volume in GLD had been high, but was back down to a normal levels on the 3rd although the bulls were then driving the price.
I'm thinking.
Here is some fear to drive the precious metals markets:
Jim Sinclair has for a long time been warning of the gargantuan over the counter derivative market and the likely, but unquantifiable potential, for a financial calamity.
Well, here are the first rumblings of the next wave of fear (panic):
Chinese State Owned Enterprises would be given the green light (by the Chinese government) to default on their derivatives.
http://thefundamentalview...
If this is not a rumor, but an actual event developing, then some more crap is about to big time hit the fan. Read the article, as it is fascinating for those interested in following the continuing financial collapse.
That was it?
Jim Sinclair has a record of saying that the calamity is imminent. "THIS IS IT!" he would shout. These are spooky times, no doubt. However, I will be more interested in his sources than his analysis and conclusions.
Update: I read the article. It's very creepy. Obama opened the door when he illegally gave the unions an oversize share of the GM carcass, to the detriment of the bond holders. Want to bet China didn't hold any of those bonds? In commercial law, contracts ARE the law. It's in the US Constitution. Government support for defaulting on contracts? In the parlance of the day, you just don't go there. But the US did. Who's next?
I am wondering which side of the oil derivatives trade China is on. The article suggests they are on the short side, which would put the US banks in a "long squeeze," forcing them to dump the oil they have parked in tankers, thus crashing the price. But I wonder. Very interesting stuff. If traders all over the world start defaulting on contracts, game over.
Just looked at the GLD chart...
It is currently showing signs of supply however, if next week sees another surge on average to high volume...then all bets for a current fall are off and a new base will form at the current resistance. of 100.44 Next week is critical for any continued rally. Another wide spread up bar closing near its high on average to high volume will seal the deal for future advances above the 100.44 level.
"...there is no doubt that it (socialism) could not possibly have affected us so widely and so deeply as it has, had it not been heavily financed". - B. Carroll Reece
Here is a possibility that I think has a high probablility.
Gold and silver with few pauses, will move on up until October, 2010. Gold will likely reach $2,000 and silver somewhere between $30 and $50. This will be because of fear, mis-perceptions about inflation, the ease with which people join in manias, and as a market mechanism to funnel new money into an outlet perceived as growing in value.
But as deflation gets out of hand, people will panic and liquidate all asset classes and gold and silver will be part of this liquidation. By 2015 gold will be under $300 and silver under $5. If the money supply implodes in a massive banking collapse where checking and savings accounts are wiped out, then federal reserve notes will temporarily be the only medium of exchange that the government allows, and it will soar in value relative to everything. Gold and silver may be more valuable relative to other asset classed than they are today or ever are in October, 2010, because other asset classes collapse even faster, but currency will be king as it always is in a deflationary collapse.
So enjoy the profits you can make between now and the autumn of 2010, but be wise enough to see the change of tide when it comes, and stuff your mattress when the time is right.
Just think that if everyone knew that the price of gold was on its way to $2,000 everyone who could, would liquidate their other investments, and buy gold today, and the price would arrive at $2,000 overnight; but this is not how price changes work. The movement is a geometric progression, heavily influenced by cyclical movements, which eventually exhausts itself when most of the people who can buy have already bought, and there are few new buyers who can come in to drive up the price further. This is what happened in the last bull run in gold in the late 1970's, early 1980's. This is what happened in the real estate bubble which currently is collapsing. This is how stock market peaks and crashes develop. The ones who are lucky enough to play it right are the winners, and those who can't tell which way the wind is blowing, wind up buying near the end getting burned by the hot potato.
The exact timing for these events may be different than I anticipate but not by much. The framework, I think is likely.
Histocically gold rises with
Historically gold rises with inflation and deflation.
at this point in time and space...
gold and silver can not possibly be "overbought"...
the demand is far too great and the supply is far too little...
it is a simple equation, people...cut through the "fluff" of any one or three people's personal opinions (even mine) and follow your own heart...
if you believe all is well, invest in treasuries, if not, invest in precious metals and commodities...
where do you think the wealth of this country's (and your own family's) future lies?
the dollar or the pm's and corn, wheat, and pork bellies?
i'll take precious metals and pork bellies...you make the choice you must live with!
O Captain, My Captain, rise up and hear the bells!
Is it possible for Prechter
Is it possible for Prechter to have less credibility?
i hope somebody learns from
i hope somebody learns from this..... 9-4-09 gold at 995.50.
The USA is under Gods judgement.. it is only a matter of time... he is throwing out lifeboats for those who have eyes to see and ears to hear.. are you one of these people...
I think Mish and Prechter are very "Heavily Overbought"
When money starts to flee the 'safety' of Gummint Bonds, watch out.