Morning Views from Big Al and Trader Rog
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Hi Matthew,
Great comments,
Big Al
Well the HUI closed just below the 50 dma, but gold held, closing just above the 50 dma.
Well composed and thought-out comment…as usual. You mention the HUI holding at it’s 50MA…do you find a fund like this repects support and resistance rather than, say, futures or a single equity? I’ve still never quite decided if a fund is the same as watching the true underlying asset or given companies of which it’s made up.
Well, maybe I should clarify…’a fund is the same’….it’s never the same, but I meant ‘just as good as’.
I use the HUI because it is an index of unhedged miners. Note that the Exchange Traded Fund (GDX) that is supposed to track it broke below 150 dma and 200 dma yesterday, while the underlying index did not. GDX can obviously get pushed around by an excited market.
I personnly find the music annoying but its your site & I will still continue to visit.
Hi Richard,
Thank you for saying you will continue to visit. We will make some changes. What would you like to see?
Big Al
Yeah the music is a bit strange Al! I thought you were guesting on some country radio show. 😉
Anyway, the $1750 hard support and the 33.48 support for silver were well and truly smashed apart today.
Take that music off! Our favourite metals have been clobbered since you had that music!
Perhaps the Russian Death March??
Looking at SGOL, an ETF that tracks gold much better than GLD, gold’s decline (so far) reversed at precisely 171.87 — the 34 day exponential moving average. Here too, I think the 50 day moving average will hold on any further weakness.
There are explanations out there for this irrational movement in the PM’s. When Goldman continously shorts gold whenever the price starts to climb it’s no wonder that you take two steps back for every step forward. Why bother with PM’s when the price is manipulated? Manipulated to the point that all the fundamentals are in place and have been and there is no solution in sight to the financial problems yet the PM’s still can’t get out of their way and gain a little ground. Why would you continue? Just asking.
If gold were taking two steps back for every step forward, it would not have risen to as high as 700% of it’s 2001 price. Your response is the desired one by the manipulators. They are the biggest BULLS of all. They win by keeping as many people as possible out or offsides (short) for as long as possible. Most investors will play “bag-holder” because most investors do not act with conviction until it is very late. The MSM will be pushing gold and the miners before this is done. I guarantee it. How else will the biggest boys extricate themselves from their vast positions? Prices only go higher on NEW interest. Those of us who are already “in” do not add to the buying pressure.
Mat,
Thanks for the respopnse. Are the central banks pushing gold prices lower in order to buy or to keep the dollar up? Just wondering.
Central banks are a tool. Notice that they were net sellers when gold was cheap and nobody cared? Now, they are net buyers. Those who say that it’s because they are stupid, are themselves very naive. The people are on the hook for the policies of the Fed. The private banks that own the Fed benefit at the people’s expense. So when the Fed was selling gold, it was time to buy. By prolonging gold’s weakness, and therefore prolonging $ strength, the biggest money is able to divest itself of a large part of it’s dollar denominated assets at very favorable valuations. The biggest money takes a very long term view and a patient approach when accumulating or distributing any asset class. They have to. They are discreet in all their actions. This is why the biggest rallies in the last century have come during a bear market (to sucker in new bag-holders), and the scariest corrections always come during a bull market (to scare away competing “accumulators”). When gold is really in a bubble, CNBC and Bloomberg will be insisting that it is not. Just as they did in 2000 with the NASDAQ. Or in ’05,’06, and ’07 with housing.
Hi Jerry,
I have asked that question many times in the past and I am comfortable with the following answer: “prices cannot be held down forever and when that ends the explosion upward will be MEANINGFUL”.
I would also ask, did I make a mistake starting to buy silver at $4/ounce?
Big Al
Goldman has a price target of 2100 for gold. They are LONG gold. JP is the short
HI Cocoa,
Thank you for pointing that out.
Best,
Big Al
The LEAP GEAB No59 public report is now out.
“Specifically, LEAP/E2020 anticipates the loss of 30,000 billion ghost assets by early 2013 (2), with an acceleration in 2012 of the partitioning process of the global financial market (3) into three increasingly disconnected currency areas: Dollar, Euro, and Yuan. These two phenomena feed into each other. They will also be the cause of a sharp decline of 30% on the part of US currency in 2012 (4), as we announced last April (GEAB N°54 ), which will occur amidst a sharp reduction in demand for the US dollar and the worsening of the US governmental debt crisis. The end of 2011 will therefore see, as anticipated, the trigger of the European debt crisis detonating a US bomb. “
Nice work guys, but the music please leave it behind!!
Hi Tim,
Here’s my rational, this song illustrates that “good” will eventually win out.
By good, I certainly don’t mean the current negative aspects of our society but the goodness that once made our country great.
What do you think?
Big Al
The country never really had a great period. Its just another country that had its problems. If the US had a heyday, its because WW2 blew the heck out of everyone else. If you were black, asian, mexican or a women those were not heyday days. Theres a fantasy that the US was a beacon of greatness, but its manipulated and as oligarchical as any other place.
The US did, and does enforce the rule of law better than most, but the rules extend only to the 99%.
The lady has stumbled plenty of times, and failed plenty of times. It really has gone off the cliff in the ast 40 years thanks to moron politicians and an incredibly DUMB electorate. Permanent FAIL
Go Ron Paul!
HI Cocoa,
I agree, GO RON PAUL.
Regarding our country, yep we have had faults. I would still rather be here than most anywhere else in the world.
Best,
Big Al
Like myself, it is presumed that those on this page would like to know how the next few years will play out. Understanding that the vast majority of Americans are unprepared for what is and is about to happen suggests that a blame game where both Government and people look for scapegoats to blame and penalize. In my opinion there is a high probability that those who own and hold Precious Metals along with hedge fund managers, derivative writers and foreign nations will be targeted. This will continue for 3 to 7 years with horrible results for the US, after which I can only guess.
Like Nial Ferguson writes, “In my view, civilizations don’t rise, fall, and then gently decline, as inevitably and predictably as the four seasons or the seven ages of man. History isn’t one smooth, parabolic curve after another. Its shape is more like an exponentially steepening slope that quite suddenly drops off like a cliff.”
http://www.niallferguson.com/site/FERG/Templates/GeneralArticle.aspx?pageid=439&cc=GB
Therefore we all should read and listen to experts like Al and Roger, consider advice of others like David McAlvany, Marc Faber, Eric Sprott and all those wonderful “James and Jims” like Rogers, Synclair, Rickards, Grant, Dines and even Puplava to name just a few.
Question? Why are do many of today’s top level “Gold Bugs” have James or Jim as first name?
Thanks Clay,
I agree. Get as much input as you possibly can.
Best,
Big Al
It is a buying opportunity if it is ever going to rise again. the world wide banking system is fighting for its life today.
Silver is right back to where it was one month ago. hate to say it but silver will go below 30.
I do not see silver rising well. The &^%( american banksters are behind this. This is one reason why the world is so anti-american. The elite ruling class see the world as their oyster to do with.
Wall Street, Fed and Washington is responsible for keeping emerging markets as emerging markets.
Today’s attack is an attack on freedom.
Looks like 25 could be the next support level for silver.
If we go to $25, my short term view will have been very wrong!
Hi Big Al!
“Reality hits you hart Bro” – from George Lindell´s worldly wisdom
This song is better appropriate to express our sentiment in today´s market action in the metals…
😉
Thanks Anna,
Yep, “Reality hits you hard Bro”.
In this case I am pretty convinced that this “reality” will change!
Best,
Big Al
The EU zone crisis forces first to liquidation.
Patience is needed until Santa Claus comes!
There is nothing irrational about the markets right now… investors are taking losses on Europe fears, meeting margin calls by selling gold, and stocks … until the dollar ultimately fails (which it ultimately will), the dollar will continue to be a safe haven.
Don’t forget that although it held up better than most assets, gold also tumbled during the fall 2008 panic and silver positively (or should we say “negatively”) crashed. Technically, gold wants to return to the channel it began in Autumn 2009, and that’s what it is trying to do. That puts it at about 1680-1700 before it bounces.
Could be wrong… JMHO.
HI Dirk B,
I understand what you are saying. I would just think that in these really “silly” times more folks would be buying gold and/or silver.
As I and our guests say, don’t consider the day, consider the month or year.
Thanks for you comment,
Big Al
This price dip presents a dilema. Do I invest more at this lower price which will decrease my average price or do I sit it out because buying this dip would increase my PM portfolio percentage to a dangerous level. Or will the next dip present even better prices.
Hi Dirk,
Llower than 1680-1700!
Expected bottom in the range of 1535 (Bull Hammer from Sept 26) to 1550.
Morning Anna,
I am not sure that given the current environment I would agree that the bottom for au will be as low as $1535. I mean, who really knows. That just seems a bit low to me.
Big Al
Than let´s say between $1550-1598 to please you Big Al!
Hi Anna,
Okay, Okay and Okay!
Don’t need to please me. I have been wrong before! My problem is that I am human.
Best and, by the way, your comments are truly appreciated.
Big Al
Anna brings up a good point…prices do overshoot channels, especially on drops. Sometimes too, a drop causes the channel to have to be re-drawn to a lower slope. Trends are great, but nail-biting undulations and gyrations are guaranteed, especially in a decade long trend!
Ok, so does this make sense?……the debt crisis in Europe is not improving and may be worsening…..the probability that the SUPER COMMITTEE will reach agreement on US debt reduction is not improving and may be worsening…..the stresses within the Middle East are not improving and may be worsening….and gold/sliver are selling off. Must be something else driving the selling……heard any rumors about new CME margin hikes?
Morning Tex,
That is what I am saying, it just doesn’t make fundamental sense to me.
I am sure that in the long run, it will. Today it does not at least to me.
Big Al
Heya TEX,
It’s annoying. I think Matthew is correct, reminding us we’ve come up a long way in a month or so. We’re also coming into Thanksgiving/Christmas, and it seems even big holders of assets don’t like to take positions into weekends, much less holiday breaks. It’s a bit early for loss-selling, but with the time-bomb of EU debt, that process might also be starting.
Roger said something important which I had forgotten about it…Dec 26 – Dec 31 has became a more and more active week with markets going up that week, and I’ve missed a couple of boats thanks to this. Actually, for certain equities, I’ve seen this trick being used occasionally going back to 2002. Not always, but sometimes. A lot of the big hedge funds know the timelines…i.e. metals go up late August, or Jan-May (notice metals and certain mining stocks started going up July 31 this year, not late August). In the context of even just 1 more year, today’s waffling of metal’s prices is just noise. $30/32/34 silver…it’s all good. Until we see any whiff of fundamental buying of physical drop, which is probably years away, this is all a blip.
Like many people, I have been annoyed when gold behaves “irrationally,” as it is right now. The crisis in Europe is building, not easing. Gold should be going up, especially when demand for physical is “off the charts.”
But the idea of gold as a safe haven should come with some provisos. These provisos are established by experience, rather than logic.
2. There are times when gold is trumped as a safe haven by the $US. This “shouldn’t” be the case, but when investors bail and flee, the US$ and US bonds are STILL considered a safe haven. This may seem bizarre, but amazingly it still works that way. So I expect, that if there was a catastrophic market event (EU breaking up, another big banking crisis…), gold would crater, as it did in 2008. This will be deeply annoying to us, but is probably the most likely scenario. Even so, it should recover better and quicker than anything else. If there is a catastrophic event, being in gold stocks, no matter how good they are, will probably not save us. I say this with the qualification that during the market slide into March 2009 gold stocks performed much better than the general market and even became a kind of safe haven. But during that time the catastrophe had been averted already and things were simply “bad” but getting less desperate.
3. Remember the last pullback from $1920 all the way to – what was it – 15??. Many speculated that this was the result of an orchestrated take-down. Maybe it was, but whatever the cause may be, the result was that even with an evolving European debt crises, gold had ceased to be a safe haven. At least it acted that way. Then we saw the recent run up to about $1800 and suddenly gold is a safe haven again, although the situation in Europe temporarily looked better with the agreement on the bailout package being struck. So gold ran up even though the risk appeared to have lessened in the mind of the market (which is not to say that risk had actually decreased). It is now becoming clearer by the day that risk is increasing to ever new heights and it is just POSSIBLE that gold will go down because of this, though I’m certainly not predicting this.
4. What I’m going to say now is simply my impression. So take it as such. It appears that when things are getting worse, but are not looking desperate, gold becomes the safe haven and we see its price increase. When things move from “bad but manageable/sustainable” to “very scary indeed” and investors flee and raise cash, then gold gets hit. I think this is what we are seeing now. The grimmer the news gets, the more gold comes under pressure.
But it appears that after recent washouts and margin hikes gold is in firmer hands than it used to be. It also turns out that the amount of gold the Chinese bought this September alone is equal to half the amount of gold they bought in all of 2010. So the safe haven motif is alive and well, even when the price drops. It is this physical demand which keeps the price from plunging as low as many chartists keep expecting.
Well stated summary of events and how popular delusions concerning what are true ‘safe havens’ is a function of the level of fear. SO, we have reached the irrational fear level….go to the safe dollar haven.
Psychologically, that has proven to be so true even though people like us do not share this mindset.
Big Al
Morning Peter,
Your comments, in my opinion, are spot on.
Thanks you for sharing them with us,
Big Al
Anna,
But that hammer was just a one-day dump…. I don’t see that determining a lower support level so much as the May-June channel from 1500-1550 where the hammer’s tail hit — do you?
Dirk,
I ´ve just have a look on your chart 01.001 Weekly Gold.
Your mistake is that you have falsely drawn your blue uptrend channel.
The top of 1923.70 (more precisely 1895.00) must be included in this channel. It was no anomaly in the uptrend but its “logical” expectation. The starting point of the channel is to fix on Oct-24 of 2008 (by 712.00).
Thank Anna, I will try that… my usual approach is to eyeball the “closest to the mostest” but will look at the channel you suggest….
…tried it… looks like a megaphone to me… if you have a chart posted anywhere, please link me to it so I can better understand your point, okay? Thanks!
I would simply say: forget completely the blue channel!
Some phases are additionally restrainted (in the uptrend) or amplified (in the downtrend) through phases of the US dollar strength.
It´s not easy to define an accurate big picture.
I agree to the extent that once the pattern (here a channel) is violated/breaks down, as it has here, price may or may not re-trace to the channel bottom… true enough. Other options (like another inverse H&S) are now open.
I don’t feel so bad now. I had done what Anna suggested myself a couple days back, wondering too how much of the 1923 was an overshoot versus establishing a trend level (which partly is what prompted a comment from above). It does make the top trend line look like a megaphone, but not all channels have to be parallel (depends on your strategy and method of analysis).
Dirk, I think you also asked Roger that day that, in order for gold to hit 2050, it would have to go parabolic. My conclusion from that was two or three-fold. You conclusion is one idea…stay in an existing, parallel channel. Another is the trend could accelerate, though without really going parabolic, creating a new, higher-slope trend. And finally, the ‘megaphone’ option, (which really could be just a wider range parallel channel, with the top line based only upon the single data point of $1923, but still parallel to the lower trend line).
Technicals are a bit frustrating right now thanks to the apparent gamesmanship going on. Your charts certainly were good and I enjoyed looking at them.
Gold and silver are in widening trader ranges as we said numerous time. This means down as well as up. Today traders are selling metals and shares on fear of Europe. Europe will fix their mess or Madame LeGarde will do it for them with the IMF and the ususal suspects in the USA. Trading management works to help y ou in these cases. We are still long the PM’s for the first half of 2012 and expect gold to touch 2050 as a minimum. The metals are not irrational as its the central bankers and politicans who are. New confirmations this morning that things are worse in China and falling fast. I think all recovers for a few more months with a global crash coming in fall 2012 in the middle of the USA elections which might be delayed. Wouldn’t that be interesting? Hold tight and things come back. Usual bad days that will be overcome -Traderrog
NOTHING IS NORMAL…..
Al,
At first I thought the music was annoying, but then I listened to the words and I get your reason for it.
Concerning gold and silver prices, it’s all manipulation. When I was first introduced to the concept of gold investment and safety, I thought to myself, “The powers that be are not going to like this so they are going to do all they can to keep the price down. But, that can only happen for so long and then whoosh–just like holding the beach ball under the water.”
Music stops too suddenly-need a fade out or segueway
HI Cocoa,
I know and Sarah will do this for us shortly!
Thanks,
Big Al
Al and Rog are upbeat because they are up to their necks in an asset class that has nowhere to go but up!
The junior gold miners being the total turd in the punchbowl at the moment
Cocoa
Your comments are spot on!
The Metals got hammered 11/17 and look lower near-term. Gold could pull back
to $1630 area and stil maintain the long term trendline. I’m not sure silver will do much from here until mid to late next year. Silver bulls beware. When there are many reasons for the metals to move higher and they do not then that is bearish information to take notice of.
The US dollar hit a new recent high 11/17. The US dollar is the world’s reserve currency. Late morning 11/17 in the US, globally the US dollar liquidity market locked up, froze up, like an engine that seizes when it is out of oil. Was this Lehman time revisited, only possibly worse? Swaps hit multi-year extremes. Everything got dumped (except lumber, OJ and hogs).
Even gold was desperately being sold, liquidated, to get needed US dollars. This is a good time to hold some cash and to consider pulling down some cash out of your accounts.
There are rumors flying (reported by ZeroHedge.com early afternoon Mtn 11/17) that the entire MF Global scandal has done severe damage to the entire options and commodity futures market itself.
With so much fear out there, today was a day for buying. Cash should have been raised in April and September. When the riskiest, least known juniors refuse to fall on a day like today, that tells you the weakest hands have already fled the scene.
There are plenty of bargains. At these levels, I would rather add to my positions than my $ balance. Buy fear, sell greed.
The Euro banks are hitting the FED swap lines for liquidity again. Gold is probably getting thrown out as these banks and firms are going toes up and have cashflow issues.
The Contagion is ramping up in Europe-that will drag down everything including PM’s until everyone figures out that gold and silver are money and just as liquid as the dollar in a huge credit/liquidity disaster. Bonds as well.
Bond market is 80 times bigger than the stock market and not as easy to manipulate. When Ben has to save the bond market, he has to flush equities and cattleherd dingbat MOMO traders back and forth.
If gold tanks to 1600 area, then the liquidity crunch is ON big and every asset drops
Ron Paul is the beacon of light in a sea of surrealism.
With over what is millions dead in Iraq,alone,we have witnessed a holocaust in a generation,this generation.
Support of Iraq against Iran before Saddam was no longer an ally and we are talking up to a million more dead with 2.5 million displaced.
I read a million died in the years of US/UK/UN sanctions against Saddam,many being children.
Since the first Gulf War in 90 and 91,five million refugees recorded by the UN up into 2007,depleted uranium as a lasting legacy.
We are talking generational genocide.
Now we have Libya and Afghanistan and Pakistan and who knows,Stan?
Iran is on the list and where it ends nobody knows.
Can anybody stop the madness from eventually consuming itself?
“Avoid foreign entanglements”. Sounded pretty clear to me.
Hi Matt,
Jeff Deist will be discussing this on the upcoming Weekend Show.
Best,
Big Al
Jeff Deist and Ron Paul have the credibility that informed people acknowledge.
Credit to you,Al and many thanks.
Thanks MattB,
I could not agree more!
Best,
Big Al
Good evening Al,
May I ask what kind of silver rounds you purchase. Do you just get the rounds with the smallest premium at the time or do you prefer a certain type or mint on the round.
Thanks
I don’t see this action as irrational or negative — yet. The HUI just flew 20%+ in 6 weeks. This move prompted some to take profits, and others to lighten up on their exposure. Simultaneously, it has curtailed some of the interest in going long by those who refuse to chase price. This pullback could already be over. If not, I think the 50 day moving average will hold for the HUI at 565. The gold/silver ratio is rising, so there is some fear and/or liquidity constraints out there.