Gold Down From Almost $1,900/oz To $1,540/oz Despite Eurozone Uncertainty

11 posts / 0 new
Login or register to post comments
Last post
Wed, May 16, 2012 - 9:23am
#1
Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1738
0
Vote Up!
Gold Down From Almost $1,900/oz To $1,540/oz Despite Eurozone Uncertainty

So, since gold has fallen from it's September 2011 high of almost $1,900 per troy ounce, and is now at aroune $1,540... What would you attribute this to?

Was gold in a buble? Is it still in a bubble? According to Nicole "Stoneleigh" Foss at The Automatic Earth, it is, and projected go fall further still. More reason, she says, to remain in cash and be prepared in terms of skills and materials.

Then again ,there are others who say this is the opportunity to buy, before it rockets up again due to quantitative easing, hyperinflation.

What's your take?

Poet

Wed, May 16, 2012 - 11:29am
#2
Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2474
0
Vote Up!
Wrong target perhaps?

Poet wrote:

So, since gold has fallen from it's September 2011 high of almost $1,900 per troy ounce, and is now at aroune $1,540... What would you attribute this to?

Was gold in a buble? Is it still in a bubble? According to Nicole "Stoneleigh" Foss at The Automatic Earth, it is, and projected go fall further still. More reason, she says, to remain in cash and be prepared in terms of skills and materials.

Then again ,there are others who say this is the opportunity to buy, before it rockets up again due to quantitative easing, hyperinflation.

What's your take?

Poet

Why would you want to attribute the movement to anything?  Why not recognize the movement and trade accordingly?

Been in GLD September 165 Puts for almost two weeks.   If it moves, trade it.  Volatility is good, market neutrality is critical.

Quote:

Was gold in a buble? Is it still in a bubble? According to Nicole "Stoneleigh" Foss at The Automatic Earth, it is, and projected go fall further still. More reason, she says, to remain in cash and be prepared in terms of skills and materials.

So armed with this information, I would argue that if indicators confirm this projection is in fact happening and is likely to continue for some time, trade it to the downside.  Rather than sitting on cash that's doing nothing for you, put your cash to work for you.

Hypothetically, let's buy 20 contracts of the GLD September 155 Puts - currently trading with a Bid/Ask of $9.65/9.75.  I haven't looked at my charts, so I will caveat this blind practice trade accordingly.  Let's wait a couple of days and see what happens........

Wed, May 16, 2012 - 11:49am
#3
maceves's picture
maceves
Status: Silver Member (Offline)
Joined: Aug 23 2010
Posts: 246
0
Vote Up!
India

I did hear on one of the podcasts--maybe it was Max Keiser--that gold buying in India had come to a dead halt.  Don't know why, but it would affect the market....I doubt it will last long though.  The other factors are way over my head.   It could be a good time to buy a few more silver coins.

Wed, May 16, 2012 - 11:59am
#4
joemanc's picture
joemanc
Status: Martenson Brigade Member (Offline)
Joined: Aug 16 2008
Posts: 834
0
Vote Up!
Poet wrote:   Was gold in a

Poet wrote:

Was gold in a buble? Is it still in a bubble? According to Nicole "Stoneleigh" Foss at The Automatic Earth, it is, and projected go fall further still. More reason, she says, to remain in cash and be prepared in terms of skills and materials.

And she's been saying this for how many years? How's that worked out for her?

Wed, May 16, 2012 - 1:12pm
#5
Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1738
0
Vote Up!
I'm Not An Active Trader

I"m not an active trader. Don't know how to trade puts. Don't understand all that. Not sure it's possible from my 401(k) account.

That said, I'm not in any camp right now. I prefer to remain agnostic.

Just interested in what you guys think about this situation. Maybe it's the eye of the hurrcane...

Poet

Wed, May 16, 2012 - 1:41pm
(Reply to #5) #6
Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2474
0
Vote Up!
Poet wrote: I"m not an

Poet wrote:

I"m not an active trader.

Don't know how to trade puts.

Don't understand all that.

Not sure it's possible from my 401(k) account.

Become one, pay down your debt, build resiliency, help others, live life.  Not necessarily in that order.

Learn how.

It's actually pretty easy.

Probably is.

Wed, May 16, 2012 - 2:01pm
(Reply to #6) #7
Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1738
0
Vote Up!
Sounds Easy To You, Dogs!

Sounds easy, but that's still a while off, Dogs.

No debt. But not a lot of assets except in retirement savings accounts - and even then, more than many but not much to brag about.

Also, still working full time as a sole breadwinner, then single parenting to toddlers for about 6 hours per weeknight while my wife goes to school (summer break soon!!!), then co-parenting to same toddlers who wake up multiple times throughout the night.

My primary focii are work, sleep and keeping my boys clean, fed, clothed, learned... and keep them from killing themselves (from ingesting the wrong things, biting or hitting each other, and pushing chairs to tables to climb up them and fall off them, etc.) - and brief breaks here and there to catch up on news or be a good husband.

Poet

Dogs_In_A_Pile wrote:

Poet wrote:

I"m not an active trader.

Don't know how to trade puts.

Don't understand all that.

Not sure it's possible from my 401(k) account.

Become one, pay down your debt, build resiliency, help others, live life.  Not necessarily in that order.

Learn how.

It's actually pretty easy.

Probably is.

Wed, May 16, 2012 - 3:38pm
(Reply to #7) #8
Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2474
0
Vote Up!
Poet wrote:Sounds easy, but

Poet wrote:

Sounds easy, but that's still a while off, Dogs.

No debt. But not a lot of assets except in retirement savings accounts - and even then, more than many but not much to brag about.

Also, still working full time as a sole breadwinner, then single parenting to toddlers for about 6 hours per weeknight while my wife goes to school (summer break soon!!!), then co-parenting to same toddlers who wake up multiple times throughout the night.

My primary focii are work, sleep and keeping my boys clean, fed, clothed, learned... and keep them from killing themselves (from ingesting the wrong things, biting or hitting each other, and pushing chairs to tables to climb up them and fall off them, etc.) - and brief breaks here and there to catch up on news or be a good husband.

Poet

Poet -

Good thing I wasn't drinking any coffee when I read your comments in parentheses about your boys.....FWIW, I think you are focused on the right things.  My kids are grown, one married and on her own, one recently graduated and about to enter the workforce.  That changes my time demand signal greatly.  As a result, our square foot gardens totally rock and my G licks and bluegrass flatpick runs are improving. 

Just to update the hypothetical GDL trade I postulated in the 1st comment.....

The current Bid/Ask for the Sep 155 Puts is $10.45/10.60.  The Bid/Ask at the entry was $9.65/9.75.  If this had been a real trade it would have returned $.70 per share on 20 contracts or $1400.00 profit on $19,500.00 in.

7% return in 4 hours.......

Well see what tomorrow brings.

P.S. - It's not as far off as you might think.

Wed, May 16, 2012 - 7:53pm
(Reply to #4) #9
sofistek's picture
sofistek
Status: Gold Member (Offline)
Joined: Oct 2 2008
Posts: 461
0
Vote Up!
Preps

joemanc wrote:

Poet wrote:

Was gold in a buble? Is it still in a bubble? According to Nicole "Stoneleigh" Foss at The Automatic Earth, it is, and projected go fall further still. More reason, she says, to remain in cash and be prepared in terms of skills and materials.

And she's been saying this for how many years? How's that worked out for her?

I'm not sure she's been saying gold is in a bubble, for many years but she has put her money into preps, not gold. I think it's worked out great for her. I'd rather be prepared than not be prepared with a lot of untradeable gold, when the shit hits the fan. A lot of people here seem to have missed Chris's point of PMs being a wealth holder (which may or may not turn out to be correct), not an active investment. It (holding gold) hasn't worked out for me yet, but I've probably got twice as much cash as gold, so I'm not too bad, overall. Chris expects gold to fall moving forward (as per his latest piece) so it may not work out for anyone unless they can afford to hold it for a very long time. But preps take priority over gold purchases.

Tony

Thu, Jan 17, 2013 - 6:43pm
#10
jonarmst's picture
jonarmst
Status: Member (Offline)
Joined: Feb 14 2011
Posts: 7
+ 1
Vote Up!
No, don't pay much attention to Nicole.

I wouldn't pay that much attention to Nicole Foss on this particular issue.

Last I heard she was a subscriber to the "Eliot Wave" methodology.  While I understand the appeal of Bob "100 Year Bear" Prechter's esoteric "Eliot Waves" (being inclined to interest in all things "hidden" and esoteric myself) keep in mind that this is a fellow who got about the lowest rating (21%) when Forbes did a "Guru Report" a couple of years ago.  You can read the full review for yourself but I think the snippet from Peter Brimelow puts it most succinctly:

http://www.cxoadvisory.com/3525/individual-gurus/robert-prechter/

From Peter  Brimelow in MarketWatch (4/26/02): “Exactly how much Elliot  Wave forecast fans lost depends on whether they actually went short the market  when Prechter turned bearish. In that case, they are in a deep hole: down  99.2 percent over the last 15 years. In contrast, the stock market yielded  a 398.6 percent dividend-reinvested gain. But if Prechter’s followers merely  went into cash in the wake of Prechter’s bearishness, they would have gained  135.2 percent over those same 15 years.”

That being said, I wouldn't be at all surprised if gold corrects down to $1400 or even $1200.  Of course, I'm less of a guru than Prechter is.  My general feeling is that if you can't handle that sort of volitality then you probably shouldn't be buying much less trading precious metals (the latter is pretty much a fool's errand as far as I'm concerned -- personally, I already spend way too much time in front of a computer and I also knew a VERY smart guy who is a PM professional who basically got wiped out trading gold futures.)  Anyway, when gold dips below those lines, I'm certainly backing up the truck -- but again, that's just my $.02.  Nicole's admonition to focus on food/storage/relocation/etc. preps though is still very sound advice; I just haven't seen anything from her that indicates she's anything resembling a financial planning guru.

Jonathan Armstrong

Fri, Jan 25, 2013 - 2:22am
#11
nagan's picture
nagan
Status: Member (Offline)
Joined: Jan 9 2013
Posts: 5
0
Vote Up!
Somebody was asking if Gold

Somebody was asking if Gold is a bubble. No its not a bubble. 

Why ? because how many people do you know own more than 5% gold ? (I stole this line from Marc Faber)

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
‹ Previous topic: Proof the Fed is Juicing the Markets Next topic: US Department of Energy Shifts Focus to Rare Earths ›
Login or Register to post comments