Learn2Invest,

I read the article that you linked in the Daily Planet. This gold price view is much lower than most that I have read. I noted that the forecast calls for a drop in demand due to ZERO CENTRAL BANK PURCHASES (among other reasons). I find it very hard to beleive that the central banks of Russia, China and other emerging countries are going to all stop their dollar diversification strategies. These countries have all been buyers of gold in an attempt to diversify their reserves. China has publicly stated many times that they will continue to purchase gold over time in an effort to increase their gold reserves to 5% - more in line with average central banks of the developed world. I don't know if this is true, but I read the other day that this purchase amount equates to about one year global gold production, I can't vouch for that, but in my mind, it doesn't matter, the trend is in place for central banks to continue gold purchases, not to abruptly go to zero. Maybe the analyst is looking at central bank sales exactly offsetting central bank purchases.

The analyst also says that production will increase. Numerous CEO's have stated that global gold production will decline next year. Who is right? I guess time will tell.

Good luck.

Re: GLD

Waiting for a resistance break (downtrend line, 50 and 200 dma and $600 round #). If this occurs, the inverted head and shoulder pattern will be formed with a price target of about $40 higher.

The oil and metal stocks look like they have decoupled. Any thoughts on this from the resident experts?

Hate to be the wet blanket on the gold parade this morning but I've seen this daily action before and me no likee. If it's clearing out some old resistance with the miners, great, but I don't like the tepid response to this spike. Be careful is all I'm sayin'. It needs to establish a floor here and right now it is very unsure of itself.

USGL making it's move - $4.59 up 6.74% now.

As stated days ago, this stock had support at $3.95, could have bought it at $4.15 (or lower) that day. RSI's were still low, not yet caught on. Maybe it now catches up. Selling off because of GG legal issues was silly and a great opportunity to buy if you were listening to Bill.

MarkM, how was the World Series?

I have two comments...

1) Last week I heard Bill O'Niel (the amazing founder of investors.com) state that Mutual Funds have to hold positions for 13 weeks. Is this true? Can someone "in the know" speak to that? It is interesting obviously because we are starting the 16th week of this bull run.... window dressing will end this week, elections next week... etc...

2) When looking at Colin Twiggs charts in the WIR, it appears they are all bullish short/medium/long term (DOW, SP500, Nasdaq). At least he states all are in "accumulation phases", with the nasdaq showing the one sign of possible weakness (false breakout).

I am in the camp of a market index correction in the very near future (maybe started on friday even), so Colins charts differ from my opinion. I'd like to know what others see regarding these charts.

Thanks!

Closing Strayer Education (STRA) @ 109.52. The stock still appear to have additional upward potential, however, its 20 and 50-day MA lines are price-penetrated on the upside and the upper Bollinger Band is also intersected by current price - that's good enough for me.

Currently monitoring Forward Air (FWRD) No position yet although with the holiday season upon us, the knowledge that online retailers and our fellow citizens are gearing up to move those packages from point A to Point B could provide some interesting monitoring.

Boeing (BA) signaled "BUY ME" as well.

Well that didn't take long! Sorry folks. (Gold)

g034-

I'll take the glass of champagne but did you ever see a team play worse than the Tigers did in that series?

All-If people would quit piling on the shorts on this market we wouldn't have these little 50 point countermoves like today's. Sheesh.

Bill, you and I are in agreement about AEM. I said it was my "bellcow" 2 months ago, having replaced RGLD in that role.

Oil in the 40's?
Is this possible?

I say yes.
The US consumer is dead.
Special measures are required.

Lower oil is needed in order for the Paulson Put to continue.

Lower oil is needed in order for the usual seasonal patterns and cycles to work for the US markets for the remainder of the year.

Otherwise were going into Bear mode.
Contrary to others - I don't see Reflation as an option here for the Feds - and they will fight any price rise in oil's and golds tooth and nail.

If they can't bring these things down NOW - they will take the whole market down like they did in May - probably after XMAS.

So if you're a Bull - you short oils' and golds at resistance and buy Growth Stocks on pullbacks.

If you're a Bear - you buy oils and golds on weakness - then wait for Ben and Paulson's signal - then short the whole market across the board as they take it down.

Count me in for the Bull case - seeing oils and golds only as short term trades.

P.S If were going into a recession next year - the market will run up as hard is it can NOW - to cushion the decline next year.

... just my 2 cents

Only if the data allows for the spin T'man. If it doesn't they will reset the markets after the elections are out of the way. Right now they are doing a great job spinning awful numbers. At a point, it can't continue because there will be too many who will see the need to get out and won't want to be left holding the bag. Let's see what the first consolidation looks like. JMHO.

To be sure, homage has to be paid by the market to the 'obvious' weakness at some point - data spinning can only go so far.

In any case, whether November or January/ February - I think it will be the 'inflationaries' that will become the bogeymen and be taken out back and shot (ie: oils, golds, metals and some industrial cyclical stocks). Anything else falling will eventually be 'bought' back up.

I sense they (the Fed's) are desperate and things are more serious than they let on.
So I continue to believe (and it was confirmed again today) that they will manipulate Oil as low as they possibly can - maybe as low as that $40 Gulf War spike in 1991.

It is often these unthinkables that become ones biggest trades of the year.

No one expects oil to go into the 40's
No one expects Gold to go into the 400's
No one expects that a new Bull market has started in the US.
And No one expects a hard landing or World recession coming.

Trading these 4 things can make us a lot of money - we just don't want to get caught on the wrong side - or have our timing wrong by trying to call tops.

So for now I am on the side of 'Play Along with the Feds manipulations --- who knows , it may work for a few years - but if/when they fail then obviously 'short the crap out of everything paper' and hold Gold to protect one's wealth.

good trading to all

Re: "No one expects oil to go into the 40's
No one expects Gold to go into the 400's
No one expects that a new Bull market has started in the US.
And No one expects a hard landing or World recession coming."

Excellent analysis, short-term traders should always expect the unexpected and trade the trend.

The old saying goes... "Don't think about it, accept it and trade it."

The SPY exactly hit my lower subchannel trend line and stayed above it today. It was a lower close than friday, but it did it on much lighter volume. This tells me the SPY has a better chance to go up tomorrow vs down.

The XAU, GLD and GDX all (just) stayed above the MA supports there were above before the start of the day. As a gold bull i would have liked to see them not close at the lows of the day.. but volume did not seem that strong so no damage in my eyes.

I'll find out tomorrow.

No one expects oil to go into the 80's
No one expects gold to go into the 700's...

Average gold gains in my portfolio were 2.17% today, I'll take that anyday. No one thinks that gold can break this resistance, I think it will over time and don't think it's worth all the hand wringing - although I do like all the gold bears on this site ;-)

I caught some wind on USGL, buying ahead of today's move. I'm wary of the oils right now, confirmed after reading Tradesman's worthy take on the situation. We'll just have to see how low she'll go, but the short term charts are not looking good. In the meantime, I feel like a putz for having recently bought a Corolla. <8)

HBs still being held up with spit, gum and baling wire.

I'm no Gold bear... just a trader.

I was presenting scenarios that no one expects - and... Yes... I have been trading on them.

Short term - G034's Gold scenario is highly probable - because it would cause the 'most pain'.

BUT if the Golds 'break out' however resistance does NOT turn into support - then I will simply short Golds on the breakdown.
Otherwise I reenter the trade because the move up would be quite dramatic.

I AM an Energy Bear and have been for a while. (for the record I am short oil stocks)

My reasoning is simple (I like simple things)
(1) Oil is manipulated - always has been.
(2) US Consumer Economy is dead - I mean toast.
In order to keep the US out of recession they need lower Oil prices.
(3) If they can't get the price lower - then the US will go into recession - and the Oil price will go lower anyways.

So oil has 3 strikes against it.

It has only one thing going for it - geopolitics (that means Bush and/or Iran) and for the moment they are behaving themselves. But of course anything could happen.

This will be a real battle now - between the Bull market of the last 3 years (oils, golds, metals, inflationaries) and the new Bull market Paulson is trying to foster.

If there's no clear winner - then I guess we'll call it a draw - and be stuck in a stagflating trading range for all assets.

For now however I'll go with the 'death of the old bull' (short) and the 'birth of a new bull' (long) game plan for now...

Tradesman - I hear ya' about trading and you make sense. I have scalped in the pits where sometimes your holding period is less than one second. Now I am a position trader with different responsibilities, holding periods range from a couple of weeks to many months. This is called the "Daytrader Bullboard", so maybe I don't fit here anymore.

Anyway, I read your post and I'd like to comment on; "(2) US Consumer Economy is dead - I mean toast. In order to keep the US out of recession they need lower Oil prices."

If the economy is indeed toast, the dollar is dead due to lack of tax revenue to fund our spending habits. The printing presses will be running on full steam to compensate. Eventually, the recent gold / oil correlation trade will decouple and gold will rise dramatically. As a matter of fact, did the decoupling start today? Oil was hit hard, gold rallied when it should have fallen.

I am hoping for one last gold breakdown, let the shorts get loaded up and squeezed. Any weakness needs to be bought, IMO.

Long gold.

G034

Eric Bolling of Fast Money agrees with the decoupling of oil and gold

His trade was to short oil and go long gold until the Gold/Oil ratio ratio reaches its norm (I believe its 12 - am I right on this??)

At todays ratio gold should be $700.
Oil at $50 would mean gold at $600.

Anyone know Bolling or any of the traders on Fast Money?

here's a link to a site which follows the show and posts the traders recommendations.

http://www.fastmoneyreview.com/forum/forum_posts.asp?TID=101

Never trust a pit trader ;-)

Wouldn't want to meet one in an alley.

According to Traderpedia:

A typical pit trader will be big, loud and wearing a brightly coloured trading jacket.
They generally don't take kindly to hippies.

Link to Times article
http://www.timesonline.co.uk/article/0,,2-1487741,00.html

... just some humour to end the day

btw.. what was it like in those pits??
you must have gained a real intuitive sense of the markets - which is hard to come by nowadays -with everyone trading off of screens...

Trading off of screens?! I use a Magic Eight Ball.

Gold off $4.50 more as I type. Hope you caught yesterday morning's warning. That was just simple tape reading folks. Not to worry. Everything will be okay so long as it doesn't penetrate 579/80. If so I have to go back to the drawing board as to when it is going to make its move. As it stands now, it's early/mid November.

Per g034, not a daytrader either. Just have a sense for gold's tape. That and the charts I gave you. And my bellcow. How do you determine the bellcow? You look at the charts! Last cycle it was RGLD. No more.