Gold and Jobs Friday

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locklimitdown's picture
locklimitdown
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Gold and Jobs Friday

PMs got a rare pop off the jobs data,

{as an aside, the excitement and anticipation prior to the employment release borders on bizarre  with all """""market""""" data is rarely credible IMHO}...

but as we have seen countless times before, the pm cartel reentered after 25 minutes and its been tough sledding ever since. I see gold is worth 14.00 less than it was at 9:00...Not bad for two hours work after such an encouraging open. Silver capped at 18.50 and has been beaten back 15 cents.

The sm is holding its own with down days now only a legend. I am beginning to lean towards  Dow 50000 100000 who knows?... as hyperinflation is the feds mission. This is more than the working group buying here. Looks like a flight to anything tangible may be unfolding. Of course what should be outperforming all asset classes, pms, are being held in check with more naked paper selling. JPM will not stop terrorizing the pm longs until the big players take delivery. They have never taken delivery in the past. Will they in the future? And how can they take delivery of something that doesn't exist? Knowing this why would they dick around in a """"Market"""" that would have to declare Force Majeure should a very very small percentage of the players demand the real stuff as opposed to fiat or forward contracts.
Pms will be held hostage never seeing fair value until the LBMA CONex JPM HSBC and co. are run out of town. I have been waiting for 10 years plus for that to happen. Will we have to wait another 10 years?

Looks like  the same script has been ordered just like all the other Jobs Fridays in the past. Once again paper traders know a JPM opportunity when they see one
This mornings pm pop was a shorting gift..

Lets hope it backfires on them.

Dave from Denver out with another good piece...

http://truthingold.blogspot.com/2010/01/musings-on-markets-penny-for-old-guy.html

Friday, January 8, 2010
Musings On The Markets - "A Penny For The Old Guy"

It appears as if the Asians tried to "game" the Comex by dumping gold overnite ahead of the jobs number and got their fingers burned. This is an epic reversal for the metals on a "jobs lost" Friday. This is incredibly bullish.

The Fed has made it clear that they are going to have to ramp up their printing press, the Treasury yield curve is starting to price in an acceleration in inflation - either dollar devaluation/money supply expansion or actual price inflation, or both - and the Obama Government loses credibility now on a daily basis. The stock market - contrary to the babbling ignorance expressed by those on CNBC/Bloomberg (and now NPR) - is not reflecting the expectations of robust economicgrowth, but rather the clear and present signal that the Fed has no choice left but to hyperinflate the money supply in order to monetize growing Treasury issuance and the accelerating collapse of commercial and residential credit markets. If we have any kind of surprises this year, it won't from an unexpectedly strong economy but from an unexpected move higher in gold.

On an anectdotal note: we were surveying the home listings in the Denver area online last night and were quite stunned by the large number of listings in zip codes most affected by bubble-pricing. Even more shocking was the number of homes for rent on Craislist. Oh ya, there are now 37 million people in this country - over 10% of the population - now on food stamps.  Our economic system is drifting into an economic Heart of Darkness - "Mistah Kurtz He Dead."

This just in:  the Government household survey show 680,000 jobs were lost in December.  This report, which never gets any televised media exposure and won't reported in newspapers tomorrow, is considered to be infinitely more accurate than the HIV-cocktail headline-reported number.
Posted by Dave in Denver at 8:06 AM

Cheers
Norm

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Re: Gold and Jobs Friday

I was watching closely this morning and saw the fake out short at about 8;30 eastern the gold price plunged about 8 dollars to trigger all the stops on the longs then  a couple minutes later it shot straight up 20 dollars after cleaning out all the longs. this wasn't the asians getting clipped this was market manipulation Goldman Sachs style at it's finest. ( these are approximations -- the charts from the Iphone aren't as good as my forex charts at home)

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Re: Gold and Jobs Friday
docmims wrote:

I was watching closely this morning and saw the fake out short at about 8;30 eastern the gold price plunged about 8 dollars to trigger all the stops on the longs then  a couple minutes later it shot straight up 20 dollars after cleaning out all the longs. this wasn't the asians getting clipped this was market manipulation Goldman Sachs style at it's finest. ( these are approximations -- the charts from the Iphone aren't as good as my forex charts at home)

doc -

You can call it manipulation (it wasn't), but what happened was entirely legal.  What the market maker was doing was going after the stupid people who had market order buys/sells in place.  If someone is going to put a flashing sign on their head that says "I am an idiot, come take my money" by using market orders to enter and exit positions, why shouldn't the market maker take advantage of that?  The market maker exists solely to create fluidity in the market.  He does this by managing the Bid/Ask spreads.  The market maker is not your friend.  Market makers knock out the stops every morning of every trading day - typically squeezing people who "buy the news".  Check out a time and sales summary sheet between 8:30 and 10:30AM on any trading day and you can see it happening.  Pay particular attention to "Amateur Hour" from 9:30 - 10:30AM.

Too manhy people think of market makers as (at the very least), neutrally positioned if not benevolent entities who won't take advantage of opportunities presented to them.  The sooner the average private investor begins viewing the market maker as an adversary instead of a neutral third party the better off they will be and the better trader they will become.

Now if those people had stop limits (with underlying stops in the event of a meltdown) or limit orders in place to trigger buys on the rise they would be throwing a party instead of complaining about giving easy money up to the market maker.

Anyone who trades using market orders instead of limit orders deserves to be separated from their money.  Kind of like the old "Never bring a knife to a gun fight."  With regards to viewing the market maker, successful private traders need to adopt the mindset of bringing a gun to a pillow fight and then using it.

"The Market Maker's Edge" by Josh Lukeman and "Pit Bull:  Lessons From Wall Street's Champion Day Trader" by Martin Schwartz are very good reads on how the market maker functions.

Just my opinion though.

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Mike Pilat
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Re: Gold and Jobs Friday

Who in their right mind would trade using market orders...? At least under most conceivable circumstances. That said, trading with actual stops is sometimes risky, as the market maker can see and raid these too. Limit orders, mental stops, sanity, and diligence are your friend. If the market maker is taking advantage of all the market orders in amateur hour, trade it on the reversal!

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locklimitdown
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Re: Gold and Jobs Friday

There is mountains of evidence the precious metals paper """markets""" are beyond farce, especially during the CONex hours of operation.

One need not look any further than JPMs paper pm short positions to know what is goind on behind the curtain. Trading the CONex is like taking a gun to your financial health. They make no effort to hide massive intervention especially at 0820 each and every day.

 

If the CONex had not been open for business in recent years gold would be many thousands of dollars and silver many multipuls of where we are today. Over many thousands of hours I have witnessed enough of their illegal antics for 1000 lifetimes.

Paper pms are the most manipulated markets on the planet IMO.

Taking Delivery is the only way to beat them.

 

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Re: Gold and Jobs Friday
Lock Limit Down wrote:

Paper pms are the most manipulated markets on the planet IMO.

Taking Delivery is the only way to beat them.

LLD -

Well played.

Every now and then, someone in this community makes a post with a profound statement.  Not necessarily the deepest or most poetic or thought provoking, but powerful in and of itself due to its simplicity.

This is one of them.

 

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Re: Gold and Jobs Friday
Dogs_In_A_Pile wrote:

 

"The Market Maker's Edge" by Josh Lukeman and "Pit Bull:  Lessons From Wall Street's Champion Day Trader" by Martin Schwartz are very good reads on how the market maker functions.

Just my opinion though.

thanks i'll have to add those to my reading materials.  Still learning the forex.  I didn't say  it was illegal -- just what i'm getting used to seeing right before the NY opens.

BTW I read somewhere today that COMEX was settling with GLD shares lately.  Maybe the beginning of the end(default) for them?

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Re: Gold and Jobs Friday
Dogs_In_A_Pile wrote:

You can call it manipulation (it wasn't), but what happened was entirely legal.  What the market maker was doing was going after the stupid people who had market order buys/sells in place.  If someone is going to put a flashing sign on their head that says "I am an idiot, come take my money" by using market orders to enter and exit positions, why shouldn't the market maker take advantage of that?  The market maker exists solely to create fluidity in the market.  He does this by managing the Bid/Ask spreads.  The market maker is not your friend.  Market makers knock out the stops every morning of every trading day - typically squeezing people who "buy the news".  Check out a time and sales summary sheet between 8:30 and 10:30AM on any trading day and you can see it happening.  Pay particular attention to "Amateur Hour" from 9:30 - 10:30AM.

Too manhy people think of market makers as (at the very least), neutrally positioned if not benevolent entities who won't take advantage of opportunities presented to them.  The sooner the average private investor begins viewing the market maker as an adversary instead of a neutral third party the better off they will be and the better trader they will become.

Now if those people had stop limits (with underlying stops in the event of a meltdown) or limit orders in place to trigger buys on the rise they would be throwing a party instead of complaining about giving easy money up to the market maker.

Anyone who trades using market orders instead of limit orders deserves to be separated from their money.  Kind of like the old "Never bring a knife to a gun fight."  With regards to viewing the market maker, successful private traders need to adopt the mindset of bringing a gun to a pillow fight and then using it.

"The Market Maker's Edge" by Josh Lukeman and "Pit Bull:  Lessons From Wall Street's Champion Day Trader" by Martin Schwartz are very good reads on how the market maker functions.

Just my opinion though.

Best damn post ever in my humble opinion. (not to pick on you specifically Doc)

Makes me yearn for an old Captain Sheeple News Brief: (repost)

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Mike Pilat
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Re: Gold and Jobs Friday

I'm not sure if COMEX has actually started settling in GLD, but I know they changed their "rules" so that it is now possible for them to settle in GLD. Big integrity difference between GOLD and GLD these days...

Dogs_In_A_Pile's picture
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Re: Gold and Jobs Friday

doc -

It's a good sign that you are 'seeing' these events.  The next step is for you to turn them to your advantage.

Keep a close eye on things from 8:30 through 10:30.  Every now and then a really good trade entry point in the direction opposite of the premarket moves shows up that you can take advantage of.  You have to babysit those trades though and be ready to leave as soon as you have a small profit.

Paper PMs have been pretty ripe lately for these bounces.  As have DIA, OEX, NDX.X whenever premarket futures are big green or big red relative to the previous day's close.

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Mike Pilat
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Re: Gold and Jobs Friday

Dogs -

Any thoughts on trading SPY??

I've looked at the volume and the spreads on options for SPY, OEX, DIA, QQQQ and I find that SPY is generally more liquid than all of them. All things being equal, it is nice to be able to reduce the spread you have to cover on an option.

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Dogs_In_A_Pile
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Re: Gold and Jobs Friday
Mike Pilat wrote:

Dogs -

Any thoughts on trading SPY??

I've looked at the volume and the spreads on options for SPY, OEX, DIA, QQQQ and I find that SPY is generally more liquid than all of them. All things being equal, it is nice to be able to reduce the spread you have to cover on an option.

Hey Mike -

SPY can be traded like the indices above.  Cat has had so much success with DIA we just haven't ventured in trading SPY too much.  Generally speaking, if the spread is narrower, the underlying index usually doesn't move as "much" pricewise so you have to be certain of the trade before you get in (so you will get enough movement to make up the difference in Bid/Ask and make a profit) and you have to pull the plug if it backs up on you.  But since the spreads are narrower > less price volatility, you will have time to make a good assessment.  Don't forget to buy in or at the money and lots of time if you are trading the options on the index.

But then again, throwing up on a GOOG roller coaster trade with a $7 spread can be fun too - in a really twisted kind of way.

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