Hello Bart,
I'm a little afraid to post here today <NG>
I'll share some trading thoughts and my "big confusion".
Regarding the broad market, I'm expecting a little bounce right about here. My logic is that they are just not going to give up the 1040 trendline without at least one fight. I will short any significant bounce, but I think a dream entry like 1150 is highly unlikely. Looking ahead, unless there is either a very, very significant improvement in employment or some fiscally prudent solution to the Euro concerns, I think we have some serious down ahead. I think an improvement in employment is unlikely and for the Euro, well the cats out of the bag and we know now that the ECB and the member states are very happy to create a crisis and help their export markets. I believe the collusion between central banks may be seeing some real strain and an "every nation for themselves" mindset taking hold. I fully expect some crazy printing and QE to start as soon as things are recognized as bad and getting worse. It will be no surprise if the timing for more of Ben's market madness fits nicely with the midterm elections and those phat bonuses the boyz love at year end. Fundamentals won't mean a damn thing, but buy printing ink if you are Ben/Graham kinda guy <g>
I must admit your M3 data has my attention, both as a driver for phat profit from pending short positions and my curiosity as to how well my bullion will perform on the long side during a serious market correction (like 950 or below on the spoos). Perhaps I'll consider some DZZ to protect my golden nuggets from an "unfair" market adjustment.
Which brings me to my big confusion, which are miners. Miners have been my preferred bread and butter mad-stack generator vehicle of choice for more than five years. But, something happened for me about two months ago, and that is I lost any ability to predict what they were going to do next. I'm not much a buy and hold type trader/investor, so I found myself flipping coins too much. And I simply don't flip coins (which is why I covered my shorts yesterday right at 1050...for I'd rather ride a trend than guess one). For all the reasons you have listed for gold price changes, the primary driver in my thinking for the relative poor performance of the miners is simply disbelief. I can only assume that many do not think the POG move is real, and thus do not want to push miners to new highs and "equal" value relative to the move in POG. I would say that liquidity drivers from the momo monkeys was a factor, but miners were lagging when the momo monkeys were rolling in mad stacks as the market pounded higher month after month. I cannot trade something I cannot predict or understand, so I've had to play elsewhere except on a few occasions that a very interesting entry was possible on some of my favorite majors and high quality mids.
I've talked with many traders about this poor miner performance. No one has an answer that has satisfied me or given me a tool to reengage with confidence. One of the better traders I know basically sold his entire miner position and is now more or less playing the short side with me.
Any insight you have would be welcomed.
As for POG crashing below 950, well I just don't see it. It is a global market and demand for gold is increasing everywhere, albeit on a small scale relative to most investments.
Last, my dream trade is to short US Treasuries to hell. Many have tried and died along the way. Still, I think an entry from a ten year in the high 2 range should be a very good bet. I build the position over a number of entries. I expect to put that trade on within the next year. A few failed auctions will give us some early warning for timing the entry.
GT
TH |
