Thursday, Apr 24, 2008
Gold/silver bull not over
Safe Haven: Gold and Silver Chart Bonanza!
"First I would like to debunk some of the reasons given why the bull run in precious metals is over"
1) The Fed will be done cutting rates.
2) A recession means lower demand and consumption, which in turn pushes down inflation.
3) Precious Metals are in a bubble
Posted by sold 2 rent 1 @ 10:50 AM (825 views) Add Comment
30 Comments
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1. sold 2 rent 1 said...
2. Dead Money said...
Great charts, and I didn't see one bubble!
3. sold 2 rent 1 said...
Here is the graph I posted yesterday of gold's 3 stages
4. sold 2 rent 1 said...
techieman,
I can't see why you think we are still in stage 1 - currency devaluation
The first graph shows a trend from summer 2001 - summer 2005
This is the stage 1 - currency devaluation
From summer 2005 - present we are in stage 2 - more precisely (Elliott wave 4) (Upleg 2) (Stage 2)
We still have a massive amount of destruction to go though in May and June.
I think gold will spike to $1500+ by early July and then retrace to $1000 by September and that "top" trend line will be the new support that will be the base for Upleg 3 in 2009-10
5. James said...
This really is just gold ramping. Nonetheless - I'm grateful for your falsifiable prediction that gold will go to $1500 by late June (in your previous post here http://www.housepricecrash.co.uk/newsblog/2008/04/blog-new-york-globex-gold-manipulation-at-new-levels-12430.php) or early July. I'll be holding you to that.
For reference, the consensus market view seems to be a gold price about $1000/oz for the end of June. Let's see who's right...
6. cornishman said...
S2R1 -
I do agree with a lot of your thoughts on what is coming in the future, but I'll bet you that pint you promised that what you are forecasting doesn't happen until after November.
7. sold 2 rent 1 said...
cornishman,
Which points exactly and why November?
8. cornishman said...
- I don't reckon gold will go up much until after November - after the elections in the States.
Those who are rigging the market will want stocks to go up well and for a recovery to be apparent before the election. It seems to be going that way so far. The sticking plasters 'appear' to have have stopped the bleeding for now. Sentiment is generally bearish on gold right this minute.
The money supply may be increasing massively, but if that money just sits in a bank, it can't cause inflation. Once everyone starts to relax thinking the worst is over, the money that has been pumped into the banks recently will start to move again and then inflation will take off hugely. Then people will really panic and things will happen very quickly.
Money supply is only half of the equation. Velocity counts as well.
Just a thought - could be completely wrong, obviously!
9. sold 2 rent 1 said...
More for techieman on stage 2 gold,
Written in November 18, 2005
Gold Bull Stage Two 2
http://www.zealllc.com/2005/goldtwo2.htm
"The bottom line is gold’s behavior is resembling early Stage Two patterns more and more with each passing week. To see this metal reach new bull-to-date highs the same day the dollar reaches yearly highs is really extraordinary and quite exciting. Gold is decoupling from the dollar with increasing zeal and one of these months it is never going to look back. It is trading on its own fundamental merits, dollar be damned."
10. sold 2 rent 1 said...
Cornshman,
Interesting ideas but Calleman's model is suggesting a "Black Swan Event" summer.
All bets are off .... or on if you know where to put your stake!!!! ...... fowl for thought.
11. Still Renting said...
Just out of curiosity, what has this got to do with house prices?
12. cornishman said...
Now - or 6 months' time. It will make little difference in the long run if one is positioned correctly today.
Pakistan is the current wild card, so I hear.
13. techieman said...
s2r1 - As "we" anticipated looks like the USD and (to a lesser extent) £ have reversed v. the Euro. My point being that has (for now) assisted the falls in the glittery stuff. I think i said i expected a fall below 872 before new highs. From below there (and that needs some more action to pinpoint exactly where) I would turn bullish. Long term i'm still with the upside i just think we see more downside first. I think its academic if its the currency devaluation thats the cause of the upside or the general economic climate.
This "The bottom line is gold’s behavior is resembling early Stage Two patterns more and more with each passing week. To see this metal reach new bull-to-date highs the same day the dollar reaches yearly highs is really extraordinary and quite exciting. Gold is decoupling from the dollar with increasing zeal and one of these months it is never going to look back. It is trading on its own fundamental merits, dollar be damned." May have been tru then but since the dollar appreciates further there is NOW an "excuse" for gold to fall. (remember that Gold wasnt appreciating as the Euro was making new highs).
You may be right but at the moment the 900 level is fast approaching.
14. sold 2 rent 1 said...
TM,
"I think its academic if its the currency devaluation thats the cause of the upside or the general economic climate"
That is where we differ then.
I think it is extremely important to know what type of people are buying and the reasons they are buying.
Gold may go to $850 in the next week or 2, but I still stick with $1500+ by July.
15. Emily said...
you also need to look at who is selling and why. the banks are unloading lots of the glittery stuff to pay for subprime losses. And that's without the next dominoes falling in the banking sector - hedge funds and all those debt-driven private equity deals.
Bottom line, if your savings are sitting in a US or UK bank they are losing value with much higher levels of inflation than the BoE is letting on. The only option is therefore to move money into stable currencies or assets that are likely to retain value. Not housing, that's for sure.
My money's on governments and banks manipulate the markets and trying to drive gold down (and being fairly unsuccessful about it) and then going up at above inflation rates when the shit really hits the fan. Yes local demand does have an impact upon inflation (at least house prices), but we've also got record demand for resources globally that has an affect on domestic prices - food, coal, oil.
Inflation alone should be driving up the price of gold - not driving it down.
16. techieman said...
Emily where have you been all my life?
17. techieman said...
Still Renting - tin hat ready mate, your on s2r1's hit list ;-).
18. techieman said...
Jim, ive had a few pops at the old predictions - some right some erm not so right, (being modest). in any case if you want to have a go at s2r1, its fair enough it just might be an idea if you can put down some levels, or do we have a touch of the old Simon Cowells? I cant sing myself but im only here to judge you boys! Although to be fair ive always said it just dont matter whether your right or wrong its just how much money you make, but it would be quite good fun i think. Yes feel free to go back and look at a few of my posts when i have given levels..... eg currently short Cable @ 2.03 and hedged Euros / £ @ 8030.
19. techieman said...
sorry your should of course be you're! -
20. sold 2 rent 1 said...
James,
"This really is just gold ramping. Nonetheless - I'm grateful for your falsifiable prediction that gold will go to $1500 by late June (in your previous post here http://www.housepricecrash.co.uk/newsblog/2008/04/blog-new-york-globex-gold-manipulation-at-new-levels-12430.php) or early July. I'll be holding you to that."
ooooooo... pressure's on
You do make me laugh.
"For reference, the consensus market view seems to be a gold price about $1000/oz for the end of June. Let's see who's right.."
But is the consensus market factoring in a
Event
In Nassim Nicholas Taleb's definition, a black swan is a large-impact, hard-to-predict, and rare event beyond the realm of normal expectations.
The Calleman/Lungold model says we are about to have one.
21. sold 2 rent 1 said...
Still Renting,
Gold is "real money" and in time everyone will realise this.
22. cornishman said...
I can see where you're coming from, S2R1 - but you do have to see where James is coming from, also - even if one might question his motive.
A black swan event, very rare and hard to predict, beyond the realms of normal predictions/expectations - yet it is expected shortly... If it is expected/scheduled - then it can't be a black swan event, surely?
I know I'm splitting hairs!
Keep your eyes on Pakistan.
23. sold 2 rent 1 said...
cornish,
See wiki
http://en.wikipedia.org/wiki/Black_swan_theory
"Taleb regards many scientific discoveries as black swans—"undirected" and unpredicted. He gives the September 11, 2001 attacks as an example of a Black Swan event"
Clearly the organisation behind 9/11 knew about it. Whoever they are??????????
Black swans aren't unknown to everyone.
What you pay attention to, you become conscious of
What's going on with Pakistan?
24. cornishman said...
What's going on with Pakistan?
Something worrying, which could kick off at any instant, since the media isn't looking that way at the moment - but I can't remember quite what off the top of my head - which is a fat lot of use I know!
I'll see if I can find what it was tomorrow and get back to you.
25. sold 2 rent 1 said...
Was it this?
US concern for Pakistan-Taliban peace deal
http://www.radioaustralia.net.au/news/stories/200804/s2225824.htm?tab=asia
"The US has expressed concern about a possible peace deal between Pakistan and Taliban fighters along the border with Afghanistan."
The NWO can't make money when peace breaks out.
They need to create another war then
26. Bankfiddlers said...
of course a drop in the gold price would have nothing to do with the imf saying it's going to sell off 12% of its reserves! obviously been taking lessons from Gordon the moron.
http://www.forbes.com/markets/currencies/2008/04/08/gold-imf-price-markets-comm-cx_vr_0408markets09.html
27. James said...
s2r1 - do you not see the contradiction of saying that ANY model can *predict* a black swan? Have you read Taleb, or are you spending all your time watching loons in moon shirts and threatening me?
And, hey, techieman - I don't claim to have an understanding of economics or powers of prediction that people can only come to by some sort of mystical revelation. Nor do you, as far as I've seen. The only person making claims about the merits of their prediction is s2r1 - I don't feel it unfair to test them, same as I'd try and test an astrologer, a homeopath, or a faith healer.
If you ask me to put a level - well, I'll go with the consensus. For all that's happened, bank economists, etc., do know a bit more than me about precious metal levels - so here's my prediction - $1000/oz.
*Caveat*. Have just noticed that s2r1's black swan would allow him to say that gold didn't get to $1500 because of the black swan, which he predicted, so he's right. Of course, if a black swan doesn't happen, he might still be right on the other side of the bet. Let's just acknowledge now, though, that he's cleverly given himself 2 chances to 'win'.
28. techieman said...
James - you have no idea of the methods i use to forecast the market moves (i can tell you some but a few of em are held close to me chest me old son). I am actually open to the mystical stuff - whatever gives me an edge, if it works i will incorporate if not then i wont. Eg. I liked the Martin Armstrong stuff, pretty cool i thought.You can be right or wrong based on any method you like. Be your own man and have your own thoughts in my view, if that includes using a variety of different sources to reach your conclusions, then fair enough. Isnt that what we all do for example when we read the paper?
29. James said...
Techie - "You can be right or wrong based on any method you like" I entirely agree. When you use the mystical stuff, though, are you convinced there's not just a coincidental correlation?
What hacks me off about s2r1 is his contempt for the 'mainstream' when he puts his faith (and it is faith) in a bunch of untested mumbo-jumbo. All I'm trying to do is give it the most basic test.
30. James said...
Actually, I probably do have a fair idea of the methods you use if you're what we'd commonly call a technical analyst.