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Fibonacci Levels In S&P In Terms Of Gold
Below is a long-term chart of the S&P represented in terms of ounces of gold. The peak was in 1967, with a June 1980 trough. The August 2000 peak is 200% of the '67-'90 move. The 1967 peak was the long-term 2001-2005 flat level before legging lower. And the March 2009 trough was at the 23.6 retracement of the previous move, indicating a repeat of the same shape seen in 1973. With gold popping at current levels, will the 38.2 level be a ceiling: will the gold price pop be sufficient to hold back stock prices, or like in 1973, merely a temporary resistance as the ratio drops much further?
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Clearly the ratio is falling—so the issue is, will equities drop, or will gold rise?
Knowing how insiders are selling off stock, my bet's that equities tumble, hard.
Clearly the ratio is falling—so the issue is, will equities drop, or will gold rise?
Yes; one of the traditional gold bull sell indicators is dow/gold hitting 1. My current expectation is to start selling (gold) at about 4,000.
Freaky. My point is 3800.
My point is much lower.
http://www.youtube.com/watch?v=NUU9UmT134M
love that movie :D
this is a good way to think about it IF gold
is not in backwardation....
if it is backward, then i would hang on to
it for dear life....
I think either dollars will not have any value or the government will disturb property rights concerning gold by the time it is possible to obtain those terms of exchange.
Although I not that certain since the ongoing ability to sustain a house of cards demonstrated by these lunatics has been extraordinary.
Past performance is no indication of future performance, right?
History says so as fiat paper slowly approaches its final destination with gov loaded with unpayable debt on top of unfunded entitlement promises. The trend is dollar (all fiats) to zero & replacement, monumental debt buildup & erasure, bigger gov tightening grip on its displeased peoples, outsourced industry, credit contraction coupled with financial fraud, end of current ponzi cycle phenomenon. Much the same as Romans after which even gold had little purpose, buried & found centuries later as warlords took what they wanted by violence. The Euro was originally 15% backed by gold now down to about 7%. All the rest, Yuan, Yen, Sterling pure ponzi. It takes a few decades to work through.
Me too SWR!
Not before $10,000 - if the dollar survives by then i.e and only in exchange for another real asset - NOT paper dollars.
Didn't you get the memo?
The market will continue rising until we've cycled out of our positions and left all the dumb money holding the bag. What's that you say? The dumb have no money, and even if they do they can't afford to buy at these levels? Pffff, details, details.
Looks like a foghorn pattern with the lows getting lower and highs getting higher...until of course it breaks completely. I've noticed the oscillations getting wilder with each recession since the end of the gold standard. It reminds me of the San Fran bridge that oscillated wilder and wilder until the waves built on themselves and then it just fell to pieces.
The question is, if the Dow gets so far bent one direction, must it bend back equally in the other direction to merely make things normal?
I have noticed the same thing. My background is engineering, and this is a sign of a feedback loop that increases until it goes limit-to-limit in a system. Scary thing when it relates to finance.
BTW, it's the Tacoma Narrows bridge that fell apart -- http://www.youtube.com/watch?v=j-zczJXSxnw
The Tacoma Narrows Bridge, in WA.
http://en.wikipedia.org/wiki/Tacoma_Narrows_Bridge_(1940)
You mean the Tacoma Narrows Bridge?
http://www.youtube.com/watch?v=j-zczJXSxnw&feature=fvw
Sure you don't mean the Tacoma Narrows bridge?
http://www.youtube.com/watch?v=j-zczJXSxnw&feature=fvw
aka "Gallopin' Gertie"
Tacoma WA, not San Fran
Just in case you didn't see it - it's the Tacoma Narrows. Wasn't sure that message got through (snicker).
Hey Andy can you send via rapidshare or other share website the historical price of the gold thx
Eagleprojets
I think that y'all are making a big mistake by trying to tech your way through this. Between the fed manipulation and bot cycles, technical analysis has been thrown out the window.
Person here
although evaluating assets in terms of gold
weight is indeed the proper way to evaluate
it is done with a huge handicap because gold
has not been allowed to trade freely....
it is under constant assault by the fed and
treasury...thus these charts are rather
misleading...
i suspect that the natural price of gold is
quite a bit higher - especially since c. 1986
runtogold.com has good ratios of various assets
maintained in near real time....
the cost associated with restricting free trade of gold has to come in part from money that would have gone into equities so in the end it should even out. But yes, like any indicator, this one is far from perfect, but it gets to true value closest IMO.
gold price suppression does not direct money
away from equities if that was your point...in
fact it tends to do the opposite.
suppressed gold subverts all prices but especially
interest and thus would have far more impact
on bonds than equities....
then there is the problem of depressed mining
because it is unprofitable to replace existing
production at low gold prices....
gold price suppression is all about interest
rate suppression which in turn misdirects
investment....
and so charts like these must be hedged even
if they provide a proper analytical framework...
I would counter that Fed intervention is pretty everpresent, just in a marginally increasing dose as the decades pass.
When you read technicals, it's hard to account for news that may make a stock gap, but I assume that government intervenes implicitly to manipulate demand when its in alarming scarce. That means that the patterns of yesteryear inevitably reoccur, even when it seems impossible.
huh?? not sure what you are trying to say...
manipulated prices mean that the ratios are
signalling artificial / false information....
thus making comparisons across time periods
misleading...especially if as you say they
are "marginally increasing".....
the intervention is far more than marginal
and i think that gata has done an excellent
job of establishing that....and even if it
were "marginally increasing" the cumulative
effect would be quite substantial...
furthermore, unless those comparisons are done
with constant dollars, they probably aren't
worth the pixels they are printed on...
i have no idea what your second paragraph is
saying...
Thanks guys! I needed some bearish spiritual support here. I'm starting to drink too much thinking I'm loosing out...
Don't worry. There's always hope that things will be worse tomorrow.
Excellent!
I still think the thing to do is to allocate a small percentage to gold and silver and just don't worry about it.
http://upload.wikimedia.org/math/0/c/e/0cebc512d9a3ac497eda6f10203f792e.png
I consider myself a student on fibonacci numbers>
There is no way Fibo numbers can predict any market today.
USING fibo today is like trying to squeeze water
out of a rock.
or oil.
It looks like that the stock/gold-ratio turns very seldom; the major turning points are roughly the start and end of the respective bull-and bear markets.
In '73 gold and silver had a hiccup when the ratio had the spike; now they look ready to break the old high, so my bet is on temporary resistance.
they both fall from here but equities at a faster rate
Can you get any more bullish than this?:
"Cheng Siwei, former vice-chairman of the Standing Committee and now head of China's green energy drive, said Beijing was dismayed by the Fed's recourse to 'credit easing'.
'Gold is definitely an alternative, but when we buy, the price goes up. We have to do it carefully so as not to stimulate the markets,' he added.
The comments suggest that China has become the driving force in the gold market and can be counted on to
buy whenever there is a price dip, putting a floor under any correction."
http://www.telegraph.co.uk/finance/economics/6146957/China-alarmed-by-US...
I'll ask it again. Can you get any more bullish than this?:
"In a major bet that gold's rally has a long way to go, Barrick unveiled plans Tuesday to largely eliminate its troublesome gold hedge book with a massive equity issue worth as much as $4.04-billion (U.S.). Originally the deal was set at $3.45-billion, but investor interest allowed the company to up the offering.
The move to get rid of hedges shows that Mr. Regent and Barrick are banking on an increasingly positive outlook for the price of gold. The company said because of the financial crisis, it expects global monetary and fiscal reflation will be necessary for years to come."
http://www.globeinvestor.com/servlet/story/RTGAM.20090909.wbarrickhedge0...
yes you can get more bullish....
1. silver is in backwardation, again; gold will
follow
2. barrick will not unwind all of its positions
with this latest round of shareholder bashing -
their problems are too big (see rob kirby)
3. gold production is still declining (see gata)
4. central banks are net buyers (see gata)
5. china's people are being encouraged to buy
gold - imagine some healthy portion of 1300
million people buying gold...
6. us currency is still being debased
it's all green shoots for gold (except for the
evil fed / treasury boogeymen bashing down
the price with ridiculous quantities of naked
shorts)
As per an entry on this blog, ABX is only removing about a third of their hedge.
http://www.zerohedge.com/article/barrick-gold-conundrum
Lesseee, ABX was short gold from 252 to 1010, and now that they're going long by seriously diluting equity, it's bullish for gold? HW resigned from the Board with Mulroney.
Please don't feed the goldbugs.
64 month bull markets. 1920's, Nikkei, Toll Brothers, Nasdaq, Oil. There is still numerous months left until the 64 month for gold/silver.
Dow:gold going to 1. The two ways to get there matter not. I would gladly trade my gold for Dow 500.
Lessee, 1999 plus 64 months bull market is about 2005, whoops...
Gold price will increase (IMHO), but it is possible that the stock market will, too. I suspect at some point gold will rise faster, but who knows. In any case, at some point gold (and other precious metals) may be the only thing standing, but I doubt anyone can predict it until right before it happens, and likely not using any technicals or standard analysis, but rather fundamentals and intuitive reasoning.
"Intuitive reason" has cost more people more money than any other attempt at rationalization in history.
USD Index is still giving bullish signals.
DOW / SP500 / FTSE etc. daily chart shows increasing topping action.
As we know, bear market rallies do end . .
Weekly chart remains bullish so far.
Monthly chart remains bearish.
http://www.zerohedge.com/forum/market-outlook
How do you read the usdx as being bullish?
The 50 day MA is down, the index below the MA, the printing press runs overtime...
Is yor monitor turned upside down?
have lost faith in americana
i find it hard to envisage a de-leveraging type event where equities fall and gold doesn't
Really... War in the Middle East or FSU is no longer a possibility in today's world, hey?
War at Florida State? Had not considered that.
It'll be war when the "canes" show up.
Except for a shock, i.e. war or other military conflict. Or a currency/solvency crisis of one of the major currencies.
Gold is acting on its own now. New factors at play with Hong Kong demanding their gold back from London and more demand from China (other than HK). Gold goes up in times of stress and, In my opinion, will do well if the market tanks.
I'm not a gold bug, just an observer. Sold my only American Eagle on Friday.
Or Gold could fall at a lesser rate of change than equities.
E.G., Gold to 700, INDU to 3000
Gold derivatives (estimated at 80:1 actual) will be cashiered to the max in a market sell off to extinquish debt, taking the real stuff down with it. Any takers?
*
watch cramer call it a big buy now;-)