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Gold Surpasses $1,364 As 2 Year Drops To New Record Of 0.37%

Tyler Durden's picture


It is getting scary out there. The LBMA has now lost all control over the gold market, even as the Fed now has the entire bond market in the palm of its hand. A little earlier spot gold passed a new record price of $1,364, which as the chart below shows, demonstrates a parabolic blow off or something in the precious metal, while in bond land the 2 Year has collapsed to 0.37%, an unprecedented low yield. There is a possibility gold will take out $1,400 within days. Not to be left alone, the 10 Year has also surged and is now touching 2.39%, bringing it to within 11 bps of the Bund, the tightest spread since December 2009. In other news, today will be another day in which both deflation and inflation win at the same time, leading to major confusion for everyone in the prediction game. And with gold already up 1% on the day, stocks will continue to be down in real terms.


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Thu, 10/07/2010 - 08:01 | 631761 Gen X Gen Y Hybrid
Gen X Gen Y Hybrid's picture

If there is a gold correction (there has to be a pullback at some point)....where is the retracement?

Thu, 10/07/2010 - 08:04 | 631770 snowball777
snowball777's picture


Thu, 10/07/2010 - 08:07 | 631774 EscapeKey
EscapeKey's picture

There's no way I'm trading - I fear not being able to get back on board if I do.

If this is the foot of the parabolic curve, there doesn't need to be a retracement. Not saying I believe it is, but I wouldn't rule it out, either.

The USD has another horror day. USD/JPY 82.3. So much for the BoJ currency intervention.

Thu, 10/07/2010 - 09:08 | 631906 Hansel
Hansel's picture

+1, No way I'm giving my position up now either. A reason not to.

Thu, 10/07/2010 - 09:35 | 631963 Pladizow
Pladizow's picture

The smart money will buy on dips, not sell and therefore makes retracement that more difficult.

MSM starting to recomend gold - this is what scares me.

They push the sheep into the GLD with the hopes of continuing to manipulate.

Thu, 10/07/2010 - 10:37 | 632102 Henry Chinaski
Henry Chinaski's picture

Paralyzed is a good description.  Can't bring myself to sell and plan to buy on the dips.

"MSM starting to recomend gold - this is what scares me."

First, I am not sure about that.  If you go back and read tha last several MW articles on gold, they are mostly putting it down and hyping the risk and disadvantages. Second, isn't that what all the gold bugs have predicted.  At some point the masses jump in and gold goes ballistic.

Thu, 10/07/2010 - 11:16 | 632231 thesapein
thesapein's picture

Right, we can't be ahead of the curve if the rest never actually follow that curve...

Thu, 10/07/2010 - 09:10 | 631912 snowball777
snowball777's picture

The BOJ will come to their senses once it breaks 82. If Japan doesn't have its exports, it doesn't exist.

Thu, 10/07/2010 - 08:13 | 631782 unum mountaineer
unum mountaineer's picture

hope there is, but I get the sense shit is picking up in feces meet fan event(s), hence small to mid pull back, then sky rocket...this shit is money man..I'm not one to be an unwilling participant of these egomaniac's pissing contest.

Thu, 10/07/2010 - 08:16 | 631788 Turd Ferguson
Turd Ferguson's picture

I would be wary of being long tomorrow morning at this time. The Evil Empire will seize any moment they can to cause a sharp pullback by scaring out the new weak-handed, momentum-based longs.

The BLS BS that will be released in 24 hours will somehow be construed as enough of a surprise to cause some type of short-term, short-squeezing dollar bounce. The EE will then try, once again, to paint the tape with an "outside reversal day"...maybe drive gold back down through 1350 toward 1330. The question is, will our buyer(s) of size step in and bring gold back to down only a few dollars? Recent history suggests that they will. They've got the EE on the mat. There's no sense in letting their collective feet off their throats.

Thu, 10/07/2010 - 08:18 | 631793 unum mountaineer
unum mountaineer's picture

damn, i'll be in meetings all day. I should <cough> <cough>, mail it in so I can watch this play out tomorrow. Friday will be an interesting day..

Thu, 10/07/2010 - 08:19 | 631795 Clark_Griswold ...
Clark_Griswold Hedge Mnger's picture

I agree, I plan on taking some off the table today.

At some point there will be a push down, granted it could be for a day or a few hours only.

How many times have we seen it open down 1% only to recover and climb 1% by days end.

I think today's little price gift, is worthy of cashing out a bit, and reassessing tomorrow mid day.

Thu, 10/07/2010 - 08:49 | 631851 unum mountaineer
unum mountaineer's picture

very useful metal indeed. I'm always on the look out for digorno if you know what I mean...what to do with what's on ice is a little easier.

Thu, 10/07/2010 - 09:07 | 631901 JLee2027
JLee2027's picture


Thu, 10/07/2010 - 09:12 | 631916 infotechsailor
infotechsailor's picture

its not delivery...?

Thu, 10/07/2010 - 09:15 | 631921 UGrev
UGrev's picture

^thread winner

Thu, 10/07/2010 - 12:59 | 632665 Hephasteus
Hephasteus's picture

You sir win the crimex.

Thu, 10/07/2010 - 08:25 | 631803 flacon
flacon's picture

And I have a "Learning Tree" exam tomorrow! Shucks!

Thu, 10/07/2010 - 08:50 | 631853 John Bigboote
John Bigboote's picture

Nice call on $1350 by the end of the week, Turd.

Thu, 10/07/2010 - 09:24 | 631931 Turd Ferguson
Turd Ferguson's picture

Thanks, John. No reason not to expect $1500 by 12/10/10 to play out, too.

Lots more to come. December and February calls, though expensive, should payoff handsomely.

Thu, 10/07/2010 - 10:46 | 632127 MrMorden
MrMorden's picture

I hope so, that's my birthday and would make a nice present!  :D

Thu, 10/07/2010 - 09:03 | 631887 Max UK
Max UK's picture

Hi Turd,

love your comments, but have some observations.

Dollar weakens, all other things constant, price of commodities in dollars goes up. Additionally, dollar weakens, safety is sought in commodities & PMs. Fed has a policy to weaken the dollar, and we are seeing it happen real time. Its a tough call now for the cartel, with a plunging dollar, to smack gold and keep it down, no?

Secondly, if the 'buyers' are represented by one or two heavyweights, they will squeeze the cartel in a controlled fashion, so as not to ramp up the price of the thing they want to acquire. The spiralling price suggests that several buyers are now competing with each other, it is now a disorderly scrum for the metal.

These two factors are already powerful argument to suggest that the cartel has lost control, but there is a third. Gold/silver ratio has fallen to 58 for the first time in ages; silver is blazing a trail, and is the long lever on gold.

My hunch is that any smackdown will be short lived; this is game-on!

Thu, 10/07/2010 - 09:09 | 631905 JLee2027
JLee2027's picture

The spiralling price suggests that several buyers are now competing with each other, it is now a disorderly scrum for the metal.

Wait till the real action starts in a few months.

Thu, 10/07/2010 - 09:43 | 631928 Turd Ferguson
Turd Ferguson's picture

Max, I'd go along with all of your observations, particularly your reference to silver. This move in PMs/$ has seemingly taken on a life of its own buy it all started in the Comex silver pit. It became quite clear, about 6 weeks ago, that the Comex was flat out of silver...and they still are. This realization caused many gold investors, who for years had been skeptical, to begin to wonder: "hmmm, if the Comex is out of silver, they're probably out of gold, too.". 

Now, with the ongoing global currency devaluations only exacerbated by the imminent "qe2", you have the proverbial "perfect storm" overwhelming the Evil Empire. HAHAHAHAHA. Fuck em.

I have long maintained that gold would trade at 1350 by Halloween and 1500 by 12/10/10. Santa Sinclair has had, for the past eight years, a price target of 1650 by early 2011. All of these targets are now not only possible but likely. I mention this again not to tout how brilliant I am...I'm most certainly not. It's just that once you realize that the end of the Keynesian system to which we are all accustomed is upon us and once you admit that the Comex is the most manipulated "market" in the world, price action in gold gets quite predictable. "So easy a Turd can do it."


Buy all dips. Wait for the buyer(s) of size to show up first but buy all dips.

Thu, 10/07/2010 - 09:49 | 631996 Vergeltung
Vergeltung's picture

thanks for posting such informative stuff here on ZH. I am sure 1000s of readers appreciate it!

Thu, 10/07/2010 - 12:35 | 632568 DocLogo
DocLogo's picture

indeed. when it comes to PM's...turd is the shit ;)

Thu, 10/07/2010 - 10:57 | 632159 unum mountaineer
unum mountaineer's picture

DIPS... bux - check


fuck it..early lunch for me.....

Thu, 10/07/2010 - 12:16 | 632500 Spigot
Spigot's picture

If you believe in using the fibo retrace and the 1190-1210 range was the last major basing figure than you could go from the intermediate top price and drop to 32%, 50% pr 62% for the difference between the two as a potential low mark before reasserting the trend upward.

I disagree with the "parabolic" blow off terminology. If you look at the above chart we are really just getting back up to the lower trend line which started in 2005-ish. IMO I believe we are seeing a siutation where an artificially foisted selling pressure (TPTB) tried to supress the price action and then finally failed. In which case this would/may be similar to the 1976-77 gold drop before the REAL blow off which was 400% above those figures.

That would mean $5000-6000 gold price would be a peak-ish looking price.

Thu, 10/07/2010 - 12:26 | 632543 Spigot
Spigot's picture

But really, what is releasing gold? Its the final dis-investment of those with money from the "yada-yada" BS saying "everything will be better by and by". The upper 1% are turning away from this yammering and making their own decisions, and some of that goes to gold, hence, price appreciation.

The limiter here will be IF TPTB can get this train wreck under control and people start to believe again, then gold will soften, otherwise any dips will be buying opportunities. Its not a mania until everyone and the shoe shine buy are buying gold and silver.

Thu, 10/07/2010 - 08:02 | 631762 trav7777
trav7777's picture

Goled, bitchez...

gold's previous parabolic phases ran pretty hard...recall the multiyear move from 250 to 750

Thu, 10/07/2010 - 09:10 | 631911 SWRichmond
SWRichmond's picture

Parabolic, not anywhere near it.  We haven't had any $100 days yet.  By the time this thing has run its course we'll have seen $500 days, up and down.  The real mania phase is going to be a wild ride.  Why?  Simple: the failure of fiat money, and everything is denominated in fiat money.

Thu, 10/07/2010 - 10:26 | 632069 JLee2027
JLee2027's picture


Thu, 10/07/2010 - 11:44 | 632357 RockyRacoon
RockyRacoon's picture

Goled, bitchez...

Get a new one.  This one is old...

Thu, 10/07/2010 - 08:04 | 631767 unum mountaineer
unum mountaineer's picture

dont forget about Ag.

Thu, 10/07/2010 - 08:10 | 631776 snowball777
snowball777's picture

Pd, bitchezziz! +46.7% YoY (did you know that the S&P is down over 10% when denominated in relatively obscure platinum group metals?)

Thu, 10/07/2010 - 08:15 | 631789 unum mountaineer
unum mountaineer's picture

+1..yes, Pd indeed

Thu, 10/07/2010 - 08:04 | 631768 Clark_Griswold ...
Clark_Griswold Hedge Mnger's picture

January Leaps Bitchez!!!!!

Thu, 10/07/2010 - 08:05 | 631771 snowball777
snowball777's picture

Which year? ;)

Thu, 10/07/2010 - 08:07 | 631775 Clark_Griswold ...
Clark_Griswold Hedge Mnger's picture

deep in the money 2011, 2012 for gdx & slw

Thu, 10/07/2010 - 08:05 | 631772 fresbee
fresbee's picture

Gold in EURO terms is the right metric to look at. 

Thu, 10/07/2010 - 08:55 | 631867 tmosley
tmosley's picture

If you are European.

Most of us don't get paid in Euros, moron.

Thu, 10/07/2010 - 09:59 | 632023 au_bayitch
au_bayitch's picture


Thu, 10/07/2010 - 10:54 | 632146 macroeconomist
macroeconomist's picture

Well, he's not a moron, he has a good point I wanted to mention as well. Gold priced in  euros is the right metric to understand the level of "rush into gold".The price struggles to exceed the 970Euro level for quite some time, which shows that it is not escape from fiat into gold as some suggest here. Same applies to price of gold measured in a lot of other currencies (franc,yen, aussie dollar and many developing country currencies that have experienced massive appreciations), the prices are high but the levels at the moment are below maximums seen in May, and gold is not such a huge discussion. The stock markets in developing countries are soaring with carry trade, etc. So it is indeed dollar depreciating more than anything else at the moment, and some U.S investors are investing these dollars in gold. The real rush to Gold was in May, this is nothing compared to that..The real shitstorm will start when the all these charades stop simultenously..

Thu, 10/07/2010 - 09:09 | 631907 fiddler_on_the_roof
fiddler_on_the_roof's picture

Scared a bit about your short Gold trade?
Pompous Gold traders will be crucified on a
Golden cross. As "Another" said Paper Gold will
make a big fire

Thu, 10/07/2010 - 09:14 | 631920 Anton LaVey
Anton LaVey's picture

And your point is...?

Gold has been rising continuously, for the past 5 to 10 years, over all currencies you care to name. The US$ and the EUR prices have been rising, overall, pretty much in lockstep.

Currency debasement is a game many can play...

Thu, 10/07/2010 - 09:32 | 631953 ATTILA THE WIMP

Gold was up against the Euro in 2006, 2007, 2008, 2009 and so far in 2010

I read all your posts, please keep posting. I don't pretend to be a financial whiz, that's why I hang out at ZH all day and read most posts except those by insane Belgium meth heads.

Just for the record my GUESS is gold will certainly out perform all stock indexes, bonds and currencies and get to $5,000-$50,000 per Oz within 2 years.


Thu, 10/07/2010 - 08:10 | 631777 Thunder Dome
Thunder Dome's picture

YOU CAN'T EAT GOLD!!!  I'd rather buy Yellowcake (aka Uranium).

Thu, 10/07/2010 - 08:15 | 631791 mrgneiss
mrgneiss's picture

I heard Yellowcake sits heavy in the stomach.

You can drink colloidal silver!

Thu, 10/07/2010 - 10:27 | 632075 JLee2027
Thu, 10/07/2010 - 11:38 | 632329 thesapein
thesapein's picture

Just because some idiot doesn't know how to break silver up into small enough pieces so that it doesn't get trapped in the skin, doesn't mean you have to be an idiot, too.

Idiots can get sunburned. Does that mean everybody should stay out of the sun?

Sorry, I'm just so sick of this myth spreading around about silver, as if I live in a dark age of mass ignorance. No one is capable of researching the science, just passing links like rumors...

Thu, 10/07/2010 - 11:50 | 632377 RockyRacoon
RockyRacoon's picture

Silver in nano-colloidal is preferred.  I use a spray bottle and put a dash in the mouth daily after brushing teeth!  Been cold free for over 10 years.

Thu, 10/07/2010 - 14:49 | 633200 thesapein
thesapein's picture

My preference, too!

Daily? Aren't you a little worried that your body will start to rely on it? But maybe that's just me. I like to deprive myself of some important things a bit so that my body doesn't get too many ideas about outsourcing its productivity.

Thu, 10/07/2010 - 10:53 | 632144 Biosci
Biosci's picture

So you really could pay an arm and a leg, or give your left nut, because they'll have intrinsic value.  Nice.

Thu, 10/07/2010 - 08:12 | 631779 Hdawg
Hdawg's picture

Cinderella Man

"There's a storm coming that the weather man couldn't predict" - Eminem

Thu, 10/07/2010 - 08:54 | 631866 Coast Watcher
Coast Watcher's picture

"You don't need a weatherman to know which way the wind blows." - Dylan

Thu, 10/07/2010 - 09:03 | 631883 Moonrajah
Moonrajah's picture

"This is 9 tre news I'm Jimmy Jones here with your weather

We apologize for the drought all week

But it looks like thunderstorms all weekend.

We fittin to make it rain on you motherfuckers"

Jim Jones - Weatherman

Thu, 10/07/2010 - 10:26 | 632071 Xedus129
Xedus129's picture


Thu, 10/07/2010 - 08:12 | 631780 EscapeKey
EscapeKey's picture

2-10 year spread back up above 2%. Fixed income employees breathe a sigh of relief... for now.

Thu, 10/07/2010 - 08:12 | 631781 Oso
Oso's picture

anyone noticing "dollar down-stocks up" correlation seems to be breaking down last couple days...?

Thu, 10/07/2010 - 08:33 | 631815 10044
10044's picture

Yes, just like the gold down dollar up broke down a few months ago, and soon enough it'll be everything down gold up. At the same time Bob Prechter will be admitted to hospital

Thu, 10/07/2010 - 10:29 | 632078 Xedus129
Xedus129's picture

Mental hospital or Cardiology department?

Thu, 10/07/2010 - 08:14 | 631785 yuri82
yuri82's picture

"No pyramid can endura when the base collapses"

"Trillion Dollar bailout for the insiders"

"Not one dollar for the taxpayers???"


Thu, 10/07/2010 - 08:14 | 631786 JiangxiDad
JiangxiDad's picture

DXY shows support around 76, so maybe another 1% down for dollar, up for gold, for now at least. If it breaks through that this time around,all bets off.

Thu, 10/07/2010 - 08:17 | 631790 phaesed
phaesed's picture

Honestly, they're manipulating the market quite well even if it will undoubtedly fail in the long run. However the bond/gold/stock relation is rather intact, easier lending supports the market as gold skyrockets... yay! However if QE2 hits and congress authorizes new funds to blink into existance, expect a huge dollar rally.


Also with the pullback most likely over in the 30 year, I'm expecting new low yields and re-iterate my call on rates lower than 3.0%.

Thu, 10/07/2010 - 08:34 | 631817 Bringin It
Bringin It's picture

However if QE2 hits and congress authorizes new funds to blink into existance, expect a huge dollar rally.

Epic, epic  fail dude.  Your last word should read collapse, not rally.  Well you know what they say about a fool and his money.  Have fun.

Thu, 10/07/2010 - 08:42 | 631835 gwar5
gwar5's picture

Me too -- that was a head scratcher

Thu, 10/07/2010 - 08:26 | 631799 bada boom
bada boom's picture

And the rubberband stretches ever more...

The Spinners - Rubberband Man, how fitting!

Thu, 10/07/2010 - 08:25 | 631802 john_connor
john_connor's picture

Scary times indeed.  Obviously people think all hell is going to break loose over the next 2 years.  Bernanke can skew the curve to force rates lower; however he cannot force people and companies to borrow.

Also, if things are so great, why is the 3 mo. T-Bill still near zero?  If hot venture capital was in play, the 3 mo. T-bill would be rising.

Thu, 10/07/2010 - 09:18 | 631926 Anton LaVey
Anton LaVey's picture

Security play. Smart money buys gold for insurance. Dumb money - and there is no shortage of that - buys T-Bonds for insurance.

Pretty soon, even dumb money will realize that bonds are useless. Then, the real fun begins.

Thu, 10/07/2010 - 09:29 | 631943 Pining for the ...
Pining for the Fjords's picture

Exactly- scary times. And physical gold is alot more than the recommended 10-20% of my investments, so I am doing very well on this move. Nevertheless I am nervous, as something fundamental has changed in the last 2 months that I cannot get my head around. Look at that chart since Aug 1- I have yet to hear a cogent explanation that takes into account this shift in sentiment.  Yes, I know Bernanke is percieved to be backstopping the market and dead set on devaluing the dollar- was this not well understood quite some time ago? Yes, I know there is a worldwide race to the bottom in currency devaluation- haven't we known this for a very long time?

Something different and significant is taking place, I wish I knew what.

Thu, 10/07/2010 - 10:51 | 632137 Attitude_Check
Attitude_Check's picture

Gold is becoming remonetized.  Imagine the needed price for Gold that would support world-trade.  We are A LONG WAY from that price.  This is a singularity event.  On the other side of that singularity, those that have Gold will own those that do not.

Thu, 10/07/2010 - 11:52 | 632390 RockyRacoon
RockyRacoon's picture

Shadow Gold Price (SGP) ... that borrows from the Bretton Woods formula for valuing money in a gold-exchange regime (i.e. the fixed value of a currency equals its outstanding monetary base divided by official gold holdings). Under this formula the exchange rate of the US dollar to an ounce of gold would be about $8,250 presently, a figure that reflects the amount of monetary base inflation already engineered by the Fed. (The US monetary base approximated $2.15 trillion in September and reported official US gold holdings have remained relatively constant at about 8,133.5 metric tons or about 261.5 million ounces.) We approached the SGP from another angle last month and came away with a policy action we believe the markets will begin to discount. The Fed’s September 24 balance sheet reported the value of its “Gold Certificate Account” to be worth $11.037 billion, a figure that implies the Fed has claims on the US Treasury’s entire stock of gold and that it is carrying those claims on its balance sheet at Treasury’s official gold price — $42.22/oz ($11.037 billion divided by 261.5 million ounces).

Thu, 10/07/2010 - 08:31 | 631810 fiftybagger
Thu, 10/07/2010 - 09:33 | 631955 desgust
desgust's picture

uita-te la FOFOA!

Thu, 10/07/2010 - 08:37 | 631822 sudzee
sudzee's picture

Silver. The highest percentage short in the history of commodities and it just continues up. Round and round she goes and who she blows nobody knows. Whodaknowed.

Thu, 10/07/2010 - 08:37 | 631824 gwar5
gwar5's picture

I'm never leaving. I'm afraid I'll miss something. Ag and Au both kickin it again...

Naysayers and professional suppression deniers are all gone from the internet...  

PM's Theory is now mainstream fact and prices released from the gravity of the JPM and HSBC black hole.

The market wins. 


Down goes Frazier!... down goes Frazier!... down goes Frazier!



Thu, 10/07/2010 - 08:41 | 631833 lieutenantjohnchard
lieutenantjohnchard's picture

what's to fear? it's logical. paper money backed by nothing. wars. budget, trade and current account deficits. 20% to 25% under/unemployment. jobs overseas. incompetence in the white house etc etc ...

buy gold, silver etc for protection.

as sinclair said: the gold market is the world's smallest market chased by the world's biggest money.


Thu, 10/07/2010 - 08:49 | 631852 -Michelle-
-Michelle-'s picture

It's nice to put the new numbers in the spreadsheet, but when I think about what it really means... not so nice.

Thu, 10/07/2010 - 08:50 | 631854 trav7777
trav7777's picture

The gold price chart is more overbought than I can find at any point in the past 5 years.  I would be highly wary here.

The question is, supposing you take money out of miners in a 401k, where the HELL do you park it?  How much further could bonds run in a dollar countertrend rally...

Thu, 10/07/2010 - 09:13 | 631918 SWRichmond
SWRichmond's picture

Becase I suck at timing, and because I took my positions far below here, I am just sitting on it all.  Let 'er ride.  You're exactly right: where would I put the money?  I bought a ticket, I'm on the train.  I'm gonna sit here and read a book for awhile, look out the window every now and then to see where we are and how far we've traveled.  But I ain't getting off, not yet.  My holdings have gone up in value enough this week to pay my mortgage for a year.  No shit.

Thu, 10/07/2010 - 09:39 | 631967 GoinFawr
GoinFawr's picture

My holdings have gone up in value enough this week to pay my mortgage for a year.

Judge: Oh, so you're saying these bank foreclosure documents are fraudulent are you? Not according to your elected officials they're not.

Thu, 10/07/2010 - 08:52 | 631855 mjbommar
mjbommar's picture

S&P 500 is down 5% relative to gold since early September...

S&P 500 and Gold: Cumulative Return and Correlation

Thu, 10/07/2010 - 09:43 | 631979 ATTILA THE WIMP

Price of gold on Sep. 10th, 2001, the day before the horrible terrible Osama bin Subcontractor attacked us because he hates our Freedom Fries: $271.50. Current price of gold: $1,249 - up 360%.

Price of S&P 500 on Sep. 10th, 2001: 1,093. Current S&P 500: 1,110 - Up 2%

This does not take into account the dividends that one would have gotten from owning the stocks but I doubt that it would make much difference. “Current” price as of 4:30 PM September 10, 2010)

Gold up 360% stocks up 1%

Comrade peasants, we have been at war with the horrible terrible Islamo-fascists for nine years. Show me one war in all history without an increase in commodity prices or without an increase in the desire for gold, just one.

Thu, 10/07/2010 - 08:52 | 631860 Andrew G
Andrew G's picture

Cmon gold-suppression biatchez (not you my dear ZH bitchez), bring it on - let's see what you got!

Thu, 10/07/2010 - 08:55 | 631868 Bow Tie
Bow Tie's picture

we aint seen nothing yet if all these new longs are in it for the metal. and i think a good amount of them will be. no paper settlement please, lets see if there's if there's any gold (and silver) up that JPM asshole.

Thu, 10/07/2010 - 08:59 | 631875 Dollar Bill Hiccup
Dollar Bill Hiccup's picture



Thu, 10/07/2010 - 09:03 | 631889 Kina
Kina's picture

Don't think you can say overbought unless you know the reason it is flying. If people are seeing the writing on the wall and getting in before the 'rush' they wont depart easily.

Maybe some early holders may take profits, but if they understood why they went into gold they wouldn't be selling any or all of it right now, on the verge of placebo 2.




Thu, 10/07/2010 - 09:05 | 631894 scratch_and_sniff
scratch_and_sniff's picture

Scary indeed, gold is well and truly off the leash.

Thu, 10/07/2010 - 09:05 | 631895 Clark_Griswold ...
Clark_Griswold Hedge Mnger's picture

I do believe the gang at JPM, may need a early morning changing of the "briefs".....

Thu, 10/07/2010 - 09:06 | 631899 Kina
Kina's picture

This strong AUD is a pain. Common China give us a scare, drop the AUD and push even more into gold.

Thu, 10/07/2010 - 09:13 | 631917 Silverhog
Silverhog's picture

Corrections in both Gold and Silver will be brief. This PM buying spree is a revolt and just getting started.

Thu, 10/07/2010 - 09:25 | 631936 Anton LaVey
Anton LaVey's picture

Precisely. Concisely said.

Thu, 10/07/2010 - 09:16 | 631922 SWRichmond
SWRichmond's picture

In other news, today will be another day in which both deflation and inflation win at the same time, leading to major confusion for everyone in the prediction game.

There is no confusion.  Everything is deflating with respect to real money, gold.  Paper currency-thingies are deflating with respect to gold.  some things are deflating with respect to paper currency-thingies, some are not.  THAT is a source of confusion, but only for people who still believe paper currency-thingies are money.

The final paradigm.

Thu, 10/07/2010 - 09:25 | 631929 Anton LaVey
Anton LaVey's picture

One should not confuse inflation (a purely monetary phenomenon) with rising prices, which can be due to many reasons beyond inflation. Deflation and inflation at the same time is an impossibility. Deflation and rising prices, on the other hand, is perfectly possible, but the rise in prices is not due to monetary changes.

Right now, it is perfectly possible to have rising prices in many economic activities, but this is due mainly to the loss of the value of the US$ with respect to other currencies. Once Deflation and currency debasement have run their course, hyperinflation - or, at the very least, stagflation - are the only possible end-games.

Either way, this will only increase the price of Gold in US$. And other currencies, of course.

Thu, 10/07/2010 - 09:30 | 631946 JonNadler
JonNadler's picture

Am officially an imbecile

Thu, 10/07/2010 - 11:58 | 632430 RockyRacoon
RockyRacoon's picture

Don't be so hard on yourself.  Have a nice glass of milk and a cookie.

Thu, 10/07/2010 - 13:06 | 632693 Hephasteus
Hephasteus's picture

Don't worry. You won't feel a thing after a while.

Thu, 10/07/2010 - 16:20 | 633568 akak
akak's picture

I must admit that I truly admired your pretzel-logic in declaring that gold was not in a bull market, while simultaneously warning that its price is in "bubble territory".  Such mental gymnastics!  Have you ever considered taking part in the Intellectual Special Olympics?

Thu, 10/07/2010 - 09:42 | 631977 RobotTrader
RobotTrader's picture

Looks like the run is over.

Anybody have the guts to go short?


Thu, 10/07/2010 - 09:54 | 631993 Turd Ferguson
Turd Ferguson's picture

Good luck with that top call, Robo. I hope no one is foolish enough to short on your opinion.

Expect extreme volatility for the next 24 hours. Personally, I'm not doing shit except sit back and watch. Not worth it.

Thu, 10/07/2010 - 10:06 | 632043 unum mountaineer
unum mountaineer's picture have my fun bux ready though....need to finish up before 12/31

Thu, 10/07/2010 - 10:26 | 632074 JonNadler
JonNadler's picture

yes, yes, please listen to me,... I mean robot and short gold, please!!

Thu, 10/07/2010 - 13:11 | 632708 Hephasteus
Hephasteus's picture

Personally I'd get on a boat and sail to west india. But I'm feeling all Columbus for some reason.

Thu, 10/07/2010 - 09:54 | 632014 trav7777
trav7777's picture

I was callin a trader friend for short at 1360...the price looks too overbought.  Dunno how deep the correction will be, but we'll certainly find out.  I would go short here with a tight leash but short something with a higher beta.

Will be interesting to see how or if the miners confirm any move

Thu, 10/07/2010 - 10:01 | 632034 hpprinter000
hpprinter000's picture

profit taking?

Thu, 10/07/2010 - 10:42 | 632117 tmosley
tmosley's picture

I dare you.  Bet the money you normally spend on internet service.

Thu, 10/07/2010 - 16:38 | 633621 akak
akak's picture

Yes, RobotTrader, several hours of decline prove that gold's run is definitely over.

You are the ultimate in short-term-thinking idiots.

Thu, 10/07/2010 - 09:43 | 631980 BearishFeijoadaSushi
BearishFeijoadaSushi's picture

In other news, brazilian real remains pegged to Gold.

Thu, 10/07/2010 - 09:52 | 632007 trav7777
trav7777's picture

Nice vertical drop off 1360.  Would prefer to see it consolidate and burn some of this overbought off.  Don't like skislope ramps

Thu, 10/07/2010 - 09:56 | 632017 JJ McApe
JJ McApe's picture

woooohooo tyler....

20$ hit

Thu, 10/07/2010 - 09:58 | 632021 fiftybagger
fiftybagger's picture

Last time I pulled the trigger was silver 8.75.  I won't touch it unless they drop it to 15.  Note the  4 dollar premium?:

Order Date: 10/24/2008

1 oz (.999) Fine (NEW) Silver Rounds - Buffalo (11-21) $12.50
Thu, 10/07/2010 - 10:44 | 632119 tmosley
tmosley's picture

Too bad.  Looks like you won't be getting any more silver then.

Thu, 10/07/2010 - 11:20 | 632221 fiftybagger
fiftybagger's picture

Maybe, maybe not.  More realistically look for 20-21 to buy in.  That's gonna be the retest of the 2008 March highs.  Think about the high premium coins since those are compressed right now:


Why buy these?  Because when silver gets to 1000 plus an ounce counterfeiting will be a serious issue and these coins will demand a hefty premium.  Even the Chinese can't counterfeit these baby's.  Not only that, that Panda is actually denominated in yuan, which at some point might be higher than the silver value.........

Thu, 10/07/2010 - 11:14 | 632225 wafflehead
wafflehead's picture


Thu, 10/07/2010 - 10:00 | 632031 lsbumblebee
lsbumblebee's picture

I see the Cartel is busy this morning making gold more affordable for all of us. Bless their little hearts.

Thu, 10/07/2010 - 10:26 | 632072 lsbumblebee
lsbumblebee's picture

Note the timing of this takedown. Expect tomorrow's payroll report to be butt-ugly.

Thu, 10/07/2010 - 10:31 | 632085 JonNadler
JonNadler's picture

Jonny, you can come back now, Robo did, you can too, tell us you can't eat gold and that it's going to 200

Thu, 10/07/2010 - 11:35 | 632320 Scisco
Scisco's picture

I guess he heard you :)

Thu, 10/07/2010 - 10:45 | 632121 D-Falt
D-Falt's picture

Hold the gold, balance it with stocks from consumer non-durables and tobacco and alcohol sellers.  Call this portfolio Operation Shitstorm.  That's what will happen if Ben decides the QE Copter won't quite fly...

Thu, 10/07/2010 - 10:49 | 632130 MrMorden
MrMorden's picture

I just bought more physical on the drop... This ride is just getting started. 

Thu, 10/07/2010 - 10:51 | 632135 Kina
Kina's picture

And of course the CTFC wont see this blatant take down as corrupt manipulation.


Sometimes one hopes for a total crash of the US just for the satisfaction of seeing corrupt regulators dragged out onto the streets.....and dealt with for their betrayal of the US. But I suspect the corrupt bankers would make sure they were 'silenced' before it came to that.

The SEC and CTFC are the banks bitches.

Thu, 10/07/2010 - 11:00 | 632172 Clark_Griswold ...
Clark_Griswold Hedge Mnger's picture

"The SEC and CTFC are the banks bitches."

   a courtesy bitch slap would be much appreciated by viewers.

You know I was ready to take some off the table this am, but couldn't click the button fast enough.  However with this nice littel pull back (SLW down 4%, gdx down 2.70%), if I ever want to have a chance at owning my own Congressman (its all the rage these days you know), today/tomorrows move may be a good time to do a little speculating...

Thu, 10/07/2010 - 11:07 | 632195 Grand Supercycle
Grand Supercycle's picture

Updated FTSE weekly chart:

Thu, 10/07/2010 - 11:12 | 632214 Miles Kendig
Miles Kendig's picture

The nice thing about being such an undereducated autodidact is that situations like these pose no great quandry of discernment.  The fed has been fucking everyone, is fucking everyone and will continue to fuck everyone.  What is so hard about that since Ben needs a MEDICARE pump try to get it going these days?  What's scary is that Ben is addicted to the promise of blue diamonds and he just doesn't realize that being an ear worm is no great achievement.

Thu, 10/07/2010 - 11:17 | 632233 yabyum
yabyum's picture

Somehow some where a chumbawumba is smiling.

Thu, 10/07/2010 - 11:19 | 632244 MagicHandPuppet
MagicHandPuppet's picture

Gold correction, bitchez!

It's a good thing... I beez wantin' to buys me some mo'!  Where will the bottom be?

Thu, 10/07/2010 - 11:23 | 632255 Scisco
Scisco's picture

Just a thought, maybe the drop in initial claims is throwing a little bit of doubt into QE2?

Thu, 10/07/2010 - 11:26 | 632274 Johrny Bravo
Johrny Bravo's picture

Smackdown! Next stop, $900

"Goled to 540000 bitchez!!!!  Canned hamz under the porch yo!"


Thu, 10/07/2010 - 12:05 | 632449 RockyRacoon
RockyRacoon's picture

I see somebody took a chunk outta yo apple.

And your first "n" has depreciated.

You are but a poor imitation.  The real Johnny would have droned on for pages.  He would have started at the top of the comments and worked his way down at least a dozen times before collapsing in total exhaustion.

Thu, 10/07/2010 - 12:41 | 632587 goldsaver
goldsaver's picture

Is that you Johny???? Oh no, is an impostor! I miss JB!

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