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FMX Connect Sees Gold Hitting $1,550 Within 8 Weeks

Tyler Durden's picture





 

From FMX Connect:

FmxConnect uses several proprietary indicators to predict volatility trends. One indicator, the TrendVol actually gives directional signals as well.

Simply stated, if this week closes above 1416, there is a high likelihood of a 75 to 175 move higher in gold over the next 2 months. Although if the indicator hits, we'd expect the move to happen in a more compressed time. The signal does not usually waste time letting you know if it is right or wrong.

The indicator combines Bollinger bands, implied volatility, skewness, and historical volatility to determine speed and direction of a potential move. The actual calculations involve using these indicators to create and proprietary oscillators.

Volatility breathes (i.e. Bollinger bands) and FMX Connect believes that Gold volatility is getting ready to exhale in a big way.

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The Future Trade

The futures/ ETF trade would be to buy gold above 1416 on a weekly settlement or actually before the week is up if you wish to be aggressive. The trigger technically goes off after Friday’s close if we are above 1416. Your stop loss should be placed at this week’s low.

The  Options Trade

J 1500 calls, M 1450/ 1500 call spreads, Z 1500/ 1550 call spreads all offer option choices for different trading tolerances. Note that a large hedge fund has been accumulating the M 1600s, so while they may be the hot ticket, they also are priced at a premium.

The Risk

We prefer to express the trade in straddles or calls that we intend to hedge higher.  Here is why. When the signal hits, the market usually makes its move quickly. But sometimes it hits near a blow-off top.

And while the volatility continues to expand, we get a violent reversal. The short trade comes in if we settle above 1416 this week and then pierce 1371 next week.

Taking Profits

For profit exit we let the market take us out with trailing stops to protect profits after we hit a 2 to 1 reward to risk ratio. As options analysts, we like to use statistical risk/reward ratios to put on trades, and that is the basis of this one. It usually gives a 3 to 1 hit when it is right. We usually start to actively take profits at 3 to 1 reward::risk. Other than that it gives you no profit taking levels.

The last 3 times this hit, we had a minimum of 75 dollar rally, and a max of 250.

 


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Thu, 02/24/2011 - 10:58 | Link to Comment tmosley
tmosley's picture

They must be reading Turd's blog.

Thu, 02/24/2011 - 11:02 | Link to Comment High Plains Drifter
High Plains Drifter's picture

Looks like goldmiddlefinger will get it in the shorts, like the good troll that he is........ha ha ha

Thu, 02/24/2011 - 11:04 | Link to Comment bankrupt JPM bu...
bankrupt JPM buy silver's picture

good that puts silver at $50, FUBM

 

www.silvergoldsilver.blogspot.com

Thu, 02/24/2011 - 11:11 | Link to Comment tmosley
tmosley's picture

That would be the case if the correlation from the last year holds up exactly.

Over the last 12 months, gold went up $300 (25%), silver went up $17 (110%).  Following the same progression does indeed give a figure of about $50 for silver at that gold price.

Thu, 02/24/2011 - 11:14 | Link to Comment Turd Ferguson
Turd Ferguson's picture

OK, I'll go along with that. However, it was a little more challenging to make that prediction back on January 20.

http://tfmetalsreport.blogspot.com/2011/01/1600-gold-by-june-10-2011.html

 

Thu, 02/24/2011 - 11:16 | Link to Comment Sudden Debt
Sudden Debt's picture

Actually silver between 52 and 56$ into May to June is VERY likely!

And if you compaire the 2006 technicals on silver to today, 59$ is also still very possible before June.

Thu, 02/24/2011 - 11:48 | Link to Comment RockyRacoon
RockyRacoon's picture

I shared this with our Dork from Cork in another comment, but I'll pass it on here.

U. S. Mint still selling the 2010 America The Beautiful silver 5-coin proof sets.   The cost is $32.95 and there is 0.90420 ounces of silver in the set.   At $34 silver that's $30.74 in silver.   So -- figger it out.  You're paying $2.21 over spot for proof U. S. coinage in very nice packaging.   Shipping for any Mint product is $4.95.   I just bought another 25 units and will pay only the $4.95 shipping for the order.  That adds about 20 cents to the price/each.   The advantages of having these on hand should be obvious, but I'll add one more for the paranoid amongst us:  The Gov't will not confiscate these since they are numismatic items and actual legal tender.   They are nice looking as well!

https://catalog.usmint.gov/webapp/wcs/stores/servlet/ProductDisplay?cata...

Thu, 02/24/2011 - 11:56 | Link to Comment BrianOFlanagan
BrianOFlanagan's picture

thanks for the info Rocky!

Thu, 02/24/2011 - 12:03 | Link to Comment RockyRacoon
RockyRacoon's picture

It's not meant for the big players but it might get one or two folks off the fence.  Most of the anti-silver arguments are muted with this move.   These sets are selling on eBay and a few are even closing at prices higher than the buyer can go to the Mint website and buy them!   This shit just amazes me...

Thu, 02/24/2011 - 12:14 | Link to Comment Josh Randall
Josh Randall's picture

Gracias Hermano

Thu, 02/24/2011 - 13:31 | Link to Comment Pool Shark
Pool Shark's picture

Thanks Rocky! Just ordered 25 of them myself.

Usually the US mint charges huge premiums on their PM products, but sometimes a sudden rise in the price of silver or gold leaves them selling nearer to spot.

I'm taking advantage of it.

As you say; how often can you buy silver proof coins from the US mint for less than 50 cents over spot per coin including shipping?

Thu, 02/24/2011 - 13:41 | Link to Comment RockyRacoon
RockyRacoon's picture

The Mint can't raise prices at will.   It's a time-consuming process during which they usually just take product down from sale until the increase is granted.   They are just a tad behind the curve on this particular set of coins.   Don't waste your time looking for similar bargains... I've done that for you.   Ain't none.

Buying these sets is akin to hoarding nickels.  Not much down side unless the world falls apart.

Thu, 02/24/2011 - 11:14 | Link to Comment Turd Ferguson
Turd Ferguson's picture

+1

Thanks, Tmos

Thu, 02/24/2011 - 11:37 | Link to Comment tmosley
tmosley's picture

When you make your new website, I would appreciate it if you would have your own registration system.  I don't post on your blog because I hate what Facebook is now, and I don't know anything about those other services.  I read it several times per day, though.

Thu, 02/24/2011 - 11:41 | Link to Comment taraxias
taraxias's picture

seconded

Thu, 02/24/2011 - 11:41 | Link to Comment StychoKiller
StychoKiller's picture

I'll second that, I can't always figure out the google logon magic spell(s)

Thu, 02/24/2011 - 12:01 | Link to Comment Turd Ferguson
Turd Ferguson's picture

I hear ya, guys. Registration and login issues are primary reason #1 for constructing the new site. It will be made more simple. I promise.

Thu, 02/24/2011 - 12:41 | Link to Comment SRV - ES339
SRV - ES339's picture

To all of above...

I had some problems early on (like everyone else it seems), but I'd advise you to try again... just sign up on Google (very easy), then it's as simple as selecting Google from the comment drop down, post, and fill in the "secret word" (Turd doesn't give out prizes for correct answers though)!

Once you get it, there's really no problem at all.

Best Turd line ever... lol!

Also, I'd like to ask that, in the future, we refrain from using the terms "good entry point" and "Turd's Bottom" in the same sentence. Just sayin...

Thu, 02/24/2011 - 13:23 | Link to Comment Temporalist
Temporalist's picture

I refuse to use google...just like apple and face book.  Let them pay me to track my footprints.

Nothing's free bitchez!

Thu, 02/24/2011 - 14:22 | Link to Comment vas deferens
vas deferens's picture

Thanks Turd for your Great blog, and all the work your putting into this.  Cheers!!

Thu, 02/24/2011 - 12:13 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Me too...I visit but did register because of the system. Thanks...

Thu, 02/24/2011 - 13:21 | Link to Comment Temporalist
Temporalist's picture

TF I also think about posting but my AIM name is long expired and I refuse to use other services as I have too many

 

Thu, 02/24/2011 - 11:15 | Link to Comment Turd Ferguson
Turd Ferguson's picture

<double post>

Thu, 02/24/2011 - 10:58 | Link to Comment TomJoad
TomJoad's picture

Well, if they are proprietary, I am sure they must be good.

Thu, 02/24/2011 - 13:15 | Link to Comment fmxconnect
fmxconnect's picture

we said we own it, we didn't say it was good. but our partners bet wit htheir wallets. feel free to snark though. its cute.

Thu, 02/24/2011 - 10:59 | Link to Comment 10044
10044's picture

No shit, Jim Sinclair said that 10 years ago

Thu, 02/24/2011 - 11:00 | Link to Comment Oh regional Indian
Oh regional Indian's picture

Gold to 1550 means Silver to what?

If the ratio continues it's recent trajectory.....

Wynton 80? Bent on 100?

ORI

http://aadivaahan.wordpress.com/2011/02/23/666/

Thu, 02/24/2011 - 11:08 | Link to Comment Zero Govt
Zero Govt's picture

if Gold goes to $1550 Silver goes to $40

Thu, 02/24/2011 - 12:24 | Link to Comment quasimodo
quasimodo's picture

No IF, just when putz

Thu, 02/24/2011 - 13:03 | Link to Comment Zero Govt
Zero Govt's picture

"putz" is an interesting word coming from a one-eyed lumpy midget isn't it Quasimodo. I'm a putz in the PM's presumably with putzes like yourself. But don't let me question your euphoric bubble mentality with any downside possibilities ...you're going to the sky and on the way i'm going to short your arse and watch you fall.

Peace & Love ...and hope you get your vision back shortly

Thu, 02/24/2011 - 13:04 | Link to Comment tmosley
tmosley's picture

I lol at people who think people look like their avatars.

Also, deflationists.  LOL.

Thu, 02/24/2011 - 13:45 | Link to Comment Cash_is_Trash
Cash_is_Trash's picture

I for one burnt my cash to keep me warm one night and snapped this picture.

Sent from my iPhone

Thu, 02/24/2011 - 11:03 | Link to Comment Caviar Emptor
Caviar Emptor's picture

Gold is in the sweet spot where every alternative is looking shaky. 

In a stunning reversal, the Dollar is no longer the 'flight to safety' go-to play and has been selling off steadily. And US Treasuries have followed the same course. 

New anxieties over the dollar's future fate as reserve currency are rising up, and that in turn makes the status of all other currencies more clouded. 

Inflation? No need to elaborate unless you've been living under a rock. 

Stocks? Increasingly cloudy picture as more hawks voice their opinions against more QE and the Total market valuation is now above 1929 as a % of GDP

Thu, 02/24/2011 - 13:29 | Link to Comment Temporalist
Temporalist's picture

DXY is bouncing around 77.

Thu, 02/24/2011 - 11:02 | Link to Comment BrianOFlanagan
BrianOFlanagan's picture

good call.  Vol is still rediculously cheap, good idea to play this with options.

Thu, 02/24/2011 - 11:03 | Link to Comment TradingJoe
TradingJoe's picture

Why not take it ALL to ALL TIME ULTRA HIGHS and get it over with, give THEM ALL

the wealth in the world and DONE! Then we go hunting!

What a charade of greed and headless moves! We are ALL fucked already!

See Jobs over at APPL, he is a multi billionaire but...sick to death...literally!

Will all the money help him stay alive, I bet not, it may though, help him die in less

pain! Some consolation eh?!

Thu, 02/24/2011 - 11:05 | Link to Comment gordengeko
gordengeko's picture

Good lookin out TD.

Thu, 02/24/2011 - 11:20 | Link to Comment tonyw
tonyw's picture

" lowest since December 1967" and the population was about 200m then.

Thu, 02/24/2011 - 12:19 | Link to Comment Snidley Whipsnae
Snidley Whipsnae's picture

Jan home sales must be an outlier... Just yesterday we were told little Timmy is 'on top' of the economy...whatever that means.

Thu, 02/24/2011 - 11:11 | Link to Comment Scottj88
Scottj88's picture

Don't they know it is going to be 1600 by June 10th?

Anyways, I am leveraged in mining shares to feel the profit (especially silver), while the ponzi scheme still exists....

Read why here:

http://thehardrightedge.com/miningequities/

Thu, 02/24/2011 - 11:11 | Link to Comment e_u_r_o
e_u_r_o's picture

where is eur/usd parity goddamnit

Thu, 02/24/2011 - 11:13 | Link to Comment savagegoose
savagegoose's picture

u know i just realised i used to go look at yahoo stock pages, every day. just once when they open and again in afternoon or something., see how american stocks where going.

 

somewhere along the line i just stopped bothering. been looking at gold, silver, a few other metals. and hanging around ZH.seeing whats really going on.

guess the US market dont matter to me any more. its all a fucken lie anyhow.

oh wait isnt there some contrairian investment advice about when everyone curses the stock market, its time to buy?

 

Thu, 02/24/2011 - 11:30 | Link to Comment DOT
DOT's picture

When everyone runs screaming from a burning building,

is it time to go in ?

Thu, 02/24/2011 - 11:18 | Link to Comment Stuart
Stuart's picture

and for that reason, heaven and earth will be moved by Blythe Masters and the boys to keep it below $1,416.

Thu, 02/24/2011 - 11:27 | Link to Comment Crispy
Crispy's picture

Gold is in a bull market, thats all you need to know.

More genius "analysis" from the sellers of picks and shovels...

Thu, 02/24/2011 - 11:28 | Link to Comment BeerGoggles
BeerGoggles's picture

Yeah so basically, it's a bollinger band and then they create the impression that it has other "proprietary" signals and try and sell it to you.

The word "proprietary" is in a bubble.

Tue, 03/01/2011 - 19:54 | Link to Comment fmxconnect
fmxconnect's picture

Actually it is truly a prop indicator developed by comparing historical vol to implied vol and creating an oscillator. then when that Proprietary oscillator hits the right spot, we wait for the Bands to expand. when it is rgiht, you know quickly, same when it is wrong. no time wasted. witness today's action.

Thu, 02/24/2011 - 11:54 | Link to Comment godzila
godzila's picture

75 to 175 that less than 50%

 

missing something ? Waht kind of an indicator is this ?!

Tue, 03/01/2011 - 19:52 | Link to Comment fmxconnect
fmxconnect's picture

tells you not to sell strength or buy weakness. that whichever way the market moves , it is now on a slippery slope. volatility will expand

Thu, 02/24/2011 - 11:58 | Link to Comment Paper CRUSHer
Paper CRUSHer's picture

So,$1550 ya say......i gotta thosa goosebumps already.

Thu, 02/24/2011 - 12:05 | Link to Comment Math Man
Math Man's picture

Parabolic blow off top in Silver was Monday (70% move in six months).

Gold has probably peaked here too.  Even w/ a huge move in oil we haven't been able to break through December's peak of $1432.50.  Everyone is relying on China to move the price of Gold up, but last I checked, they're still tightening.  

Thu, 02/24/2011 - 12:33 | Link to Comment tmosley
tmosley's picture

You wouldn't know a blow off top if it went off in your ass.

Blow off tops are followed by precipitous declines, moron.  Not 5% corrections.

Thu, 02/24/2011 - 12:51 | Link to Comment Math Man
Math Man's picture

It's only been 2 days.  Just wait.   Silver below $20 will happen very soon.

The Nasdaq only fell 6% in the first two days after it peaked. 

But is was down over 30% within 2 months. 

$20 silver will be here by the summer.

Thu, 02/24/2011 - 12:59 | Link to Comment tmosley
tmosley's picture

Bet your life savings on it or shut the fuck up.

Thu, 02/24/2011 - 13:06 | Link to Comment Math Man
Math Man's picture

Do I sense some anger because I'm right?

I've been using the rally to buy puts on SLV.  What have you been doing besides praying that the JP morgan short rumors are true?

And PS, the backwardation doesn't matter either.  It just a result of miners hedging out their next few years earnings streams at the crazy prices.

 

Thu, 02/24/2011 - 13:15 | Link to Comment tmosley
tmosley's picture

No, I treat ALL trolls equally, like the scum you are.

I am 95% in physical silver.  

You can say whatever you like.  You will just be wrong like you have been wrong for the last ten years.  Here's a hint:  stop trying to call the top.  You can only be right once, and if you idiots had one single ounce of conviction, you would all be bankrupt many times over.  

I am a rich winner because I know what is going on.  You are a poor loser because you don't use your brain.  Enjoy your continued failure.

Thu, 02/24/2011 - 13:36 | Link to Comment Math Man
Math Man's picture

Putting 95% of your assets in one investment is suicide.

If you're wrong once, you lose everything.

On the other hand, putting 2 or 3% of your investments in to puts that pay off at 50:1 is a great trade that I can do over and over and over again.

Have fun losing your life's savings.  How long did it take you to save up for your 4 ounces of silver anyway?

Thu, 02/24/2011 - 13:40 | Link to Comment tmosley
tmosley's picture

I have conviction, you don't.  I'm rich, you're poor.  Get over it.

Thu, 02/24/2011 - 13:56 | Link to Comment Math Man
Math Man's picture

And I have diversification and risk management, and you don't.

Conviction means nothing when you're wrong.

Thu, 02/24/2011 - 14:18 | Link to Comment Bay of Pigs
Bay of Pigs's picture

Yeah, people like Sprott have really lost their shirts by staying fully invested for ten years now. It's called wealth preservation.

Di-worse-if-i-cation is for assclowns like you.

Thu, 02/24/2011 - 14:34 | Link to Comment Math Man
Math Man's picture

And the majority of their 10 year gains in Silver all came in the last six months.

Wake up.  The party is over. 

Everybody keeps saying its not a bubble because there was no parabolic top.

I call bullshit.  The Nasdaq also moved up around 70% in the six months before it peaked, just like silver, and we all saw how that ended.

 

Thu, 02/24/2011 - 14:49 | Link to Comment RockyRacoon
RockyRacoon's picture

Silver = Nasdaq    Now there's a good one.   Not even like apples and oranges.

More like left-handed midgets and corn cobs.

Thu, 02/24/2011 - 15:06 | Link to Comment Math Man
Math Man's picture

Silver = Nasdaq = Housing = Tulips

At least the Nasdaq bubble had positive long-term consequences (the internet!)... silver is pure speculation at its worst. 

If you buy silver JP morgan will go bankrupt.  There are shortages, thats why there is backwardation.  Fiat money is going to fail and we will need our silver coins to barter. 

I seriously can't wait to laugh at these posts this summer when silver is back below $20.

I will actually feel pretty sorry for tmosely though.  Putting all of your assets in one place is just stupid.  Look what happened to all the people that put all of their money in their houses during the housing bubble.  I hope tmosely didn't sell his house 40% below the peak to buy silver.

Thu, 02/24/2011 - 15:00 | Link to Comment tmosley
tmosley's picture

Sorry, dick, but you have no conviction, so no-one believes you, not even yourself.  You are just another in a ten year long string of top calling trolls.

You would do well to be silent, lest you be humiliated more over the coming days, weeks, months, and years.

While you are remaining silent, you might go back and count just how many 3% two-day downticks there have been in silver over the last ten years.  

Thu, 02/24/2011 - 12:51 | Link to Comment Bay of Pigs
Bay of Pigs's picture

Almost an automatic junk when you post Math Challenged Man. If you would pay attention I would cut you some slack. You don't, so I won't.

Go over to American Idol and watch J-Lo break down in tears...

 

Thu, 02/24/2011 - 14:51 | Link to Comment RockyRacoon
RockyRacoon's picture

At least Master Bates (AKA Johnny Bravo) was funny.   This guy is drab and humorless.

Thu, 02/24/2011 - 12:16 | Link to Comment gwar5
gwar5's picture

I don't see anywhere else I want to store value right now.

It's all too digital and dodgy and based in fiat, even the DOW.

Thu, 02/24/2011 - 12:45 | Link to Comment Bansters-in-my-...
Bansters-in-my- feces's picture

Gold maybe....

But palladium looks like someone keeps shiting on it's head.

Fucking Gubberment and their slimeball ways.

Thu, 02/24/2011 - 14:45 | Link to Comment vas deferens
vas deferens's picture

Palladium is an industrial metal. Ford lost billions years ago buying Palladium.

Around this time, the Ford Motor Company, fearing auto vehicle production disruption due to a possible palladium shortage, stockpiled large amounts of the metal purchased near the price high. When prices fell in early 2001, Ford lost nearly US$1 billion.[10] World demand for palladium increased from 100 tons in 1990 to nearly 300 tons in 2000. The global production of palladium from mines was 222 metric tons in 2006 according to USGS data.[11] Most palladium is used for catalytic converters in the automobile industry.

http://en.wikipedia.org/wiki/Palladium

 

As industrial demand falls so will the price of palladium. 

 

Thu, 02/24/2011 - 13:14 | Link to Comment fmxconnect
fmxconnect's picture

we said w e own it, we didn't say it was good. but our partners bet wit htheir wallets. feel free to snark though. its cute.

Thu, 02/24/2011 - 14:00 | Link to Comment falak pema
falak pema's picture

I'm 95% in debt and 5% in foreclosure. So I borrowed money from my avatar whose 50% in gold, 30% in silver and 20% in oil. He's rolling in money while I roll in my underwear. The snag is that I'll only be able to buy in his universe of virtual money, while I live in real debt, even denominated in useless fiat. It's an existential problem. I haven't found the key of going from his world to mine but I'm still trying using magical mirrors sold to me by the guy from GS. More trouble if I don't deliver payment for parallel sweet vision, like in that dame from Shanghai, freaking chef d'oeuvre of O. Welles, by next week. Lets see how much money my avatar will have made by then. I live and hope he'll lend me some more that I'll flog to GS.

He loves selling hot air like a self respecting 'squidder', so I don't see why he should mind being repaid in kind. Maybe I could use him to sell a lot of wind to a HF short on liquidity. Useful to have a rich avatar. Like a rich uncle.

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