Friday, Jan 18, 2008
Gold could correct to $700
Market Oracle: Indians Selling Gold To Buy Stocks
Maybe $830 isn't a big enough correction. The weaks joining the party are waiting for a small correction too. Maybe it will be down in the low 700s. Techieman?
Posted by sold 2 rent 1 @ 09:29 AM (954 views) Add Comment
24 Comments
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1. techieman said...
S2R1 - am waiting to see what develops in the first wave of this correction. The spot is bouncing along the bottom of an upwards channel. If that breaks (prob after a false b/out to begin with) then we have some more downside from here. Its looking like a head and shoulders is forming , but far too early to say with any degree (pardon the pun) of certainty. I dont know if i said to take a look at mptrader.com - he actually shorted gold just after it topped at (spot) 914. He's always a bit preemptive, he has a trial for 15 days, quite interesting. At the moment am sidelined. BTW did you see Farenheits post yesterday? - I used your name. some classics in that.
2. drewster said...
If gold is going to correct, where would be a better place for the deposits that we've carefully saved over the years to buy that now-unaffordable house? Stocks are taking a bashing, commodities are cooling (oil is down to $90 from its recent $100), the pound is plummeting... maybe I should invest in BTL? (joke!) Is there an asset class which has been overlooked?
3. inbreda said...
Best place for your hard earned (I think) is cash, being gradually converted to gold over a period of time.
4. paul said...
I know India has a rising proportion of miilionaires, but I just don't see that homemakers in Calcutta deciding gold is too expensive for their US$145 a month average salary as being that relevant against the backdrop of the rest of the world hedging against increasingly worthless paper promises.
5. cornishman said...
http://www.jsmineset.com/
there is a school of thought that reckons things are going to go with a bang very soon - regarding Bernanke's comments the other day
"Just as emotional fools sell gold and gold shares, be assured that more emotional general equity fools will unload and bring the averages down more than ever in history in one day.
Recognize this is the Formula happening like everything else much sooner and much bigger in its implications than anticipated.
Emergency action will be all splash and theatrics but truthfully the cat is out of the bag. It buys some time but corrects nothing. It makes the Formula 100% correct.
There now must be EMERGENCY ACTION because the Chairman of the Fed has BOMBED OUT PUBLICLY and a PANIC is about to occur. Expect EMERGENCY ACTION in days, not weeks."
6. happyrenterz said...
@paul India was the main buyer of gold in 2006. Most of this was for jewellery trade and so probably exported too. But Indians have a strong gold culture and buy and sell gold instead of putting money in the bank.
@ Elliot wave surfers, all the best in your predictions. There is strong belief of $1000 gold price for 2008 so I see no harm in buying now and regularly.
7. techieman said...
@hr - yes you have a point. My trading is sidelined, but my core holding remains intact at quite a lot lower levels.I have quite enough in that core holding so i wont be adding to that or liquidating it. I think its the same for S2R1. Perhaps we are being greedy, by wanting it both ways. Thats why I'm not short at the moment I couldn't bring myself to trigger a short when im in reality long. Sort of betting against myself - or is that called hedging ?
8. techieman said...
@drewster - take a look - http://books.google.com/books?id=MwPfscfeL8gC&pg=PA225&lpg=PA225&dq=safe+wealth&source=web&ots=YvewXQ1Ee4&sig=ofX0PQ42vHiRRgiREIuP4ARdQV4 - page 228 re safewealth
and http://www.safewealth.com/ - email them for their latest report.
9. drewster said...
Paul - I agree with your point, I don't see the rising price itself as a barrier to further price rises. After all, the housing market managed to run for years long after the rising price should have acted as a barrier to new entrants.
10. nopensionnohouse said...
Well regardless of how it all goes after months of deliberation I have finally opened a Bullionvault account and have transferred a couple of grand in there to play with.
Scary stuff and it doesn’t half make you concentrate!
Really enjoying getting into it.
11. cornishman said...
Has anyone here tried to take any cash back out of Bullionvault yet? Did it go OK?
12. inbreda said...
I opened an account and got that many annoying emails I never bothered transferring money in. Gold shares. Physical gold. IG Index gold buys. I might give bullionvault another go at some point in the future.
13. happyrenterz said...
@ cm good point but it seems the real test will be if things get critical and governments start grabbing gold at prices they set like the US government has done in the past. That is why I have sold my gold ETF's and put all my gold in Zurich with Bullionvault. Probably sensible to hold some physical gold coins as well, but if gold trading is outlawed that doesn't help either. All these are armageddon scenario's but it is still worth thinking about since the banks other financials have misbehaved so badly they might just have trashed our fiat currency system.
14. drewster said...
@nopensionnohouse - It's one thing talking about it, quite another to put your money where your mouth is. Remember, don't invest more than you can afford to lose.
As an initial trading strategy you should avoid buying large quantities all at once. It's safer to drip-feed small sums into a market over time - it's called Pound Cost Averaging. Since BullionVault charge only a percentage fee with no minimum fee, you can cheaply and easily drip-feed £200 a week or so into the market over the next few weeks.
@techieman - Thanks for the link. SafeWealth look like yet another advisory group of uber-bears; these seem to be increasingly common!
15. nopensionnohouse said...
@Drewster – Thanks for your words. Sound advice and I’m doing exactly that. It’s nice to be practicing what so many have been preaching. I think I have a new hobby! Now all I have to do is see if I can make it pay!
16. holding out said...
CM
I've bought & sold on Bullionvault and I had no problems.
17. cornishman said...
holding out - I've bought and sold too and had no problems - but never asked for my cash back. At the moment, whatever I have there is just a number on a computer screen...
18. happyrenterz said...
@nopensionnohouse well done for taking the plunge! It is scary but I find it gets put into perspective if I take the trouble to watch the GBP bouncing around (and especially down) on the world currency exchanges. Makes you realise how fickle "value" is even though we are reassured by being able to go out and buy something with paper money. Looking for alternative value is exciting stuff. One good effect I have found is that I have a lot less incentive to do "shopping therapy" since I have started putting effort into my investments. I hardly buy any gadgets any more!
19. nopensionnohouse said...
@happyrenterz - Its funny hearing you talk about your attitudes to “value”! I was surprised to find once I was ready to put cash in that I could do so in 3 different currencies (and sell again in any of the currencies) and do this in 3 different locations around the world.
My god, not only do you have to think about the value of Gold, but also the relative value of the currency you are using and how that might be compatible with your goal!
So I decided to learn the ropes with GBP in Zurich only to discover that I had to think in pounds and kg rather then dollars and troy oz!!
Then of course there are trading bots you can use with their XML interface…. Maybe later!
My brain hurts.
20. planning4acrash said...
You have to give them a scanned copy of a bank statement and id, i.e. driving licence and passport, to activate withdrawal facilities. I haven't done that yet.
21. submedia said...
Bullion Vault is a brilliant idea. I might use them in a few years. As for gold now i personally sold at 900 (been involved in gold for a few years now) and might think about building stake up again in 10 years time or so. I still think there is some more growth in gold as dollar falls further becuase of interest rate cuts expected and americans moving to preserve wealth. If the BoE do so as well then we will see further interest in gold. It isn't easy for a novice investor and quite scary so that would put alot of people off. So don't expect everbody to get invloved and pump up the gold price like houses! Personally i think the best place for cash at the moment is with the NSI. If your up for some risk then have a look at US property over the next few months. I believe there is real money to be made in that market as the market is, almost, in a depression and the pound is still strong to the dollar. And Gold and Silver of course. Oh and Uranium but thats too scary for me ;-)
22. holding out said...
CM
I sold and took my cash out as well - via BACS which takes 3 working days!
23. cornishman said...
holding out - that's good to know. A small part of me wonders if it's all a computer game or not and quite what's real.
24. planning4acrash said...
Holding out, I agree, this is a volatile speculative stage, but, if oil leaps, you can buy when gold shoots up, then, when it goes high, like it did at 900, you can sell. Oil will breach $100 again, and that will send gold up again. So gold really isn't a long term investment, never was without yield, its a short term hedge. If you take all the ups and don't suffer the downs, you could be so rich from that game over the past 5yrs. Wish I'd known!!