To: Bill Murphy who wrote (29954 ) 3/13/1999 8:37:00 PM From: Richard Mazzarella Read Replies (1) | Respond to
Bill, manipulation? Maybe, maybe not. Control theory doesn't suggest anything other than "normal" mechanics at work. I'll make a comment about "normal" shortly. You are probably well aware of Bollinger bands, a adaptation of control theory where a process that's in control remains within bands (2 standard deviations) approximately 98% of the time. Probability has that any process is in control when held in between those bands. A rapid move up or down outside the bands is considered a process that is out of control, on the upside called a breakout, the downside a crash. Industrial SPC and quality assurance uses this theory. A week ago I bought the xau as it was moving off the lower bollinger and sold as it bounced hard off the upper band recognizing that after two attempts, a breakout wasn't at hand. Everything behaved just as expected, no villains were required to explain a process that has been working its science for years. We can attribute many fundamental reasons why things occur, but irrespective of the fundamentals, the last couple of weeks were like all the weeks experienced in the last few years. Now back to my "normal" reference. It's quite possible that "normal" includes manipulation, criminal activity, or whatever. The point is that as long as the xau remains between it's bollingers all those fundamentals are normal. I'm not so sure there's a gold crook behind every tree. I still believe that gold doesn't go anywhere is because the miners hedging stabilizes price. People don't go long or short on things that don't change. Want a villain? It's the miners themselves.
