this am, same old story, futures bid up pre-open, then no bids on open.

are those that bid up the futures (easily done for big money) pre-open worried about more downside or following markets overseas?

IMHO, the last hour of trading will be important.

If we can't get a bid today, what will weekend portfolio reviews do for the monday open?

Monday through Wednesday I'm predicting will be ugly if no bids appear this afternoon. But then again, R. Russell was reporting Lowry's selling pressure on Wednesday at new yearly high; buying pressure at new yearly low. This is a market that definitely WANTS to go down. It has been pummeled (way oversold ST basis) and can't get up off the deck.

g034-

There's your weak close. Sold off 50 in the last hour. That's the trend. Still DOWN.

My prediction is to chop right into the CPI number which will be high, then big capitulatory sell-off establishing the ST low, definitely negative all around on the year. What did Hussman say of last year's market? "That's the way of all overvalued markets, essentially going nowhere but in interesting ways".

Just a guess, nothing else, and I'm certainly not putting any money to work testing it.

MarkM,

I really appreciate your insights. How do you see gold producer stocks versus gold itself in this scenario for the next few weeks and then for the potential big selloff later in the summer?

What I get from this forum is that gold may soon bottom out (580-600 or so), and then go back up, but why are the gold producers dropping so much and more importantly will they continue dropping even if gold starts going up?

Thx.

ursus-

Gold touched 600.3 after hours yesterday on the INO.com charts. Check it out. We're already there.

Since Bennie and the Feds are running a PsyOps on the markets expect gold and the miners to suffer until the gig is up. At some point the housing and consumer spending figures will be SO bad that a pause is REQUIRED, if not cuts to resume. At that time gold will take off along with the miners as the inflation restraints will have come off.

No need to rely on little ol' me to see when gold and the miners start to diverge from SP 500. Go to a charting source and keep a study of their ratios like I frequently report on for gold:HUI. These kind of studies (comparative) tell you a LOT.

So you COULD game this thing by trying to catch a bottom but who wants to try that? (Been there. Done that. Have the razor cuts to prove it.) Wait for the trend to break. Assemble a chart with trendlines. When it breaks channel to the upside make an entry. Small at first then build. Who cares that you didn't go all in at the bottom? If Livermore built his positions by fifths, are you any better trader? If it goes against you for some odd reason cut your losses and try again. This thing has a long way to run.

But if you want my opinion (worth as much as you paid for it) I think there could be a short rally in the miners here soon (needs market support), then choppy into summer and a base for the Fall run up to highs. A more conservative play is to wait until all this sorts out and enter in the Fall. You may miss a summer rally but you may have more hair left than others. JMHO.

And BTW, R. Russell AGAIN reporting yearly high increases in selling pressure and decreases in buying pressure (Lowry's) THURSDAY during Big Comeback Day. Conclude what you want about the strength of any counter-rallys.

Long: GLD and fully hedged otherwise.

Thx. That all makes sense. The question I have is that the "miners" have taken a big hit off their highs, much more than what gold has fallen. I am looking at xgd.to, gg, and so on, vs gold. How can this be explained?

Miners are a LEVERAGED exposure to the commodity. They usually act that way. So when gold falls 1%, GDX (the miner index) will fall 2-2.5% or more. When the equities markets are falling simultaneously, the miners get hit even harder, as traders throw out risk, like they did Thursday a.m.

They lead going down. They lead back up. When you see the miners stiffen and some start to turn, you have apretty good idea the end of the gold decline is nearby. No guarantees but that has been pretty reliable. Again, the safer play is to wait for the trendline to break. I have been fairly good at calling miner bottoms, but the equity markets were in an uptrend then. Much different animal now, as anyone who has tried to catch these knives will tell you.

( A "5 handle" is a price in the 500s, ooomph.)

Best....

thanks mark. i'm still smarting from jumping in days before ben brought gold down, but I used the bounces to pare losses and will now sit on a core of gld, gg, auy, cde and cash until we see the miners turn against the tide. agree that we will see an uptick when the fed pauses. the spot chart is starting to look like the late 70's when gold took months-long dives on its way to 850. not a market for the faint of heart, but with patience there is money to be made. thanks for the technical input... EJ

EJ-

No shame there. Even pros will get burned occasionally in THIS environment. Sounds like you managed it fine.

fine is a relative term. i didn't lose as much as everyone else, is maybe a better way to put it, which under the circumstances is ok. bill preached patience early in this retraction, but i got a little heady and learned a lesson. then i entered last week when i thought indicators were good, and still lost, but i am fairly sanguine about it given that trading is a risky and sometimes unfair proposition. for novices like me, i did ok. but no more catching falling knives. i will hold the core until i see a) the miners holding their own against falling GLD and then b) uptrend lines being broken.