Bill Cara: Gold selling off here, Wed., 6/14/2006 1:54 PM

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June 14, 2006

Gold selling off here, Wed., 6/14/2006 1:54 PM

I did explain early in the day that I figured the move in gold just after 9am, presumably derived from a Euro:Dollar trade that shot the Euro up, was a possible trap. I'm not yet comfortable that gold and the goldminers are ready to move up from today.

I suspect there is a lot of broker-dealer margin calls going out after that $34 drop in gold. A little boost in the bullion would help the accounts sell into strength.

This just apply only to gold btw. Look at the Toronto and New York equity market performance through the day today.

I have been listening to Talking Heads try to sell the audience that this rally is for real, yada yada.

This weakness has not ended. There are broken stocks. Broken industry groups. Broken sectors. Broken hedge funds. Broken banks. Broken broker-dealers.

If you don't see them today it's because I won't share my crystal ball.

The chart of spot bullion at 1:51 pm shows the price is breaking down.

Posted by Posted by Bill Cara on June 14, 2006 01:54:01 PM | Category: Cara Today in the Market , Gold

Discourse

Is it plausible that Gold will trade in the 550 to 600 range until the Fed realizes they overshot and start dumping money from the sky? At which point Gold and Silver would move higher?

It's seems crazy that many think there is a chance the Fed could raise AGAIN after this month. The more I read Bill's blog and think, think, think; the more the market cycles are coming into focus.

The sell side/CNBC, etc. are in overdrive that all is well in financial markets now that the metals have come down. It is the same behavior I saw between March and May 2000 before the bottom fell out. Smart money looks forward and the future doesn't seem so bright.

Posted by: cb at June 14, 2006 7:17 PM [link]