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Patrick - I couldn't agree with you more completely!
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Patrick, Mark, and Gizzards of all shapes, sizes, and colors,
A few thoughts on POG.
TA Thoughts:
$305 seems to be an important number for POG. The 5-year chart available at Kitco (http://www.kitco.com/charts/livegold.html) seems to show a 4 1/2 year base with a clear double-bottom around $260. This looks like a text book chart of a major bottom a la John Murphy. $305 - $260 = $45. $305 + $45 + $350. After thorough mathematical investigation and calculatorial diligence, it is my informed conclusion that POG will jump to $350 and probably get there in a hurry. I don't know exactly what this will do to XAU or GOX or HUI, but I think they will like it. Someone on the drilling thread (Sliderintheblack?) predicted an impending 50% upmove in the XAU that would take roughly six weeks or less. So borrowing that assessment, I would optimistically [ be still my aching heart :o) ] look for XAU to touch 110 (which happened to be support in 1994 and 1995 - bigcharts.marketwatch.com ) by mid-June.
I will be totally, uncontrollably, ecstatically exuberant should this wild prediction come anywhere close to being correct, but since TATRADER correctly called the birth of this nascent Golden Bull Market (which shall henceforth be known as the "GBM"), I thought that I would try my hand at predicting the date of its Barmitzvah (after it occurred, of course <GGG> ), as well as its first act of manhood: that of rising to the level of $350, just making a new 5-year high, matching brief support seen in early 1997.
I then predict a sharp drop in POG of 1/3, 1/2, or 2/3 of the rally from $260 to $350, bringing it back to $320, $305, or $290, respectively.
After that, other new highs will surely follow.
FA Thoughts:
When TA and FA don't jive, trust the TA. (Dr. Zeev)
Be that as it may, what FA might support the above blue sky speculation?
Two words: "short squeeze". Many experts said that POG was topping at $305 because the professional short positions were too high. Well, I suspect that many of these professionals are not going to have a very restful weekend this time, and will want to extricate themselves of their losing positions ASAP. Been there, done that, don't wanna do dat no mo! (Use stops; keep losses small! - TAMark) What happens when you shout "Short squeeze!" in a crowded theatre of professional gold shorters? I don't know ... but we might find out next week. Monday could be a little surprising to J6P.
Two other words: "Supply" and "Demand". If Gold producers like our friend DROOY are rapidly closing hedge positions, this should add more demand to the picture. It can be argued that as POG rises, supply will increase, but I suspect a lag time between the rise in POG and the increased production delivery. Look at the three-year RMBS chart: bigcharts.marketwatch.com . $20 to $120, to $40, to $125, to $65, to $40, to $20, to sub-$10. I am NOT at all suggesting that POG will "pump and dump" like this, but I ask the question: when RMBS was enjoying it's meteoric rise into the stratosphere, didn't the buyers know that the supply-demand picture would change? Of course they did! Zeev, for one, played the runs like a fiddle, all the while predicting the inevitable drop. I personally expect POG to trend up for several years, but a meteoric rise or two is not out of the question, in my humble opinion. It is certainly not guaranteed, but from what I read of the derivative position, world politics, world economics, wars and rumours of wars, we may be entering into a very unique period of time when the fiat currency bubble pops ("That'll NEVER happen!") and the world shudders.
Again, wild speculation, and thoughts not my own.
I claim no unique insight into any of the above, but I wanted to share my current thoughts based on what I have gathered here and there. Like TAMark, I have been waiting for this baby for a long time, and it sure appears that the GBM of a lifetime is arriving.
Not a good time to be sleeping.
We are very fortunate to have the expertise and selflessness of Mark to guide us, along with many other outstanding contributors like Pat, who has happily rejoined us for such a time as this. This thread is unique in SI. No bickering or fighting. We are friends helping each other. Mark has provided us a wonderful, productive environment, very conducive to learning and winning on Wall Street. It has remained amazingly free of the pollution that is far too common on threads. My hope and prayer is that this will continue and that we will all be able to continue to learn from this humble teacher, valued friend, and GREAT trader: Mr. TA!
Thanks, Mark! You have provided us with a wonderful home for FOUR YEARS (as of this coming Friday, 5/3). May this be only the beginning!
I am incredibly indebted to you! Give my deepest thanks to Jeanne for her patience and willingness to share so much of your time and energy with us! Behind every great man, there is a great woman. Jeanne must be some spectacular person! All the best to you and yours!
May I be the first to wish you and this thread an unbelated happy Four-Year Anniversary! May your GBM run like the wind next week to celebrate!
Go POG! Go Gold! Go XAU! Go GOX! Go HUI! Go DROOY!
Your humble apprentice - Ken |
