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GLD: A Great Set-Up!
I am sure you have heard all of the pronouncements that the bull market in gold is over. All sorts of reasons have been given from strength in the Dollar to the "you better run for the hills" price is now under the 200 day moving average for the first time in 10 months. I am not going to "poo poo" the price action, because it has been ugly, but all of the data I can muster shows that the fundamental and technical picture remains bright for gold.
First, this downdraft still remains within in the realm of pullbacks for a gold bull market. Bull market dogma would suggest that a bull market will do its best to throw you off the bull, and I believe that is what we have in this case. Second, the fundamental picture remains bright for precious metals as bond yields appear to be going lower; there is still talk that economy (or stock market) needs a life line. Third, Dollar strength is the time to buy gold. Fourth, investors' sentiment towards gold has not changed. In other words, if gold was entering a bear phase, I contend that investors actions would suggest such a dynamic. Lastly, the longer term (monthly) charts continue to suggest that the bull market in gold is very much intact, and if anything, the recent tumult in prices is a buying opportunity as price is at the bottom of a rising price channel.
Despite all the good, I am not going to minimize the technical damage that has been done. This can be seen in the weekly chart of the SPDR Gold Trust ETF (symbol: GLD). See figure 1. The pink and red dots are key pivot points, which represent the best areas of buying (support) and selling (resistance). The wide range price bar (see red arrow on chart) that closed below the support level at 157.18 is the first sign of technical damage. Support levels should hold, but this one did not, and within the context of positive fundamentals, I would consider this a warning sign.
Figure 1. GLD/ weekly
The next level of support (150.10) appears to be holding, and based upon the following daily chart of GLD, the price dynamics are turning bullish. See figure 2. Once again, the gold and black dots represent key pivot levels. This past week prices broke below the key pivot at 151.96, and with today's price action, price is likely to close back above this key pivot point level. Break below support leads to selling. Buyers step in taking prices higher leaving weak hands on the sidelines with remorse for having sold at the lows. Resistance (old support) coincides with the weekly levels at approximately 157.
Figure 2. GLD/ daily
In sum, within the context of the fundamentals, the current technical set up in GLD is compelling. A weekly close above 157 would confirm the idiocy of the crowd, and a weekly close below 150-ish would be reason to step back again from gold.
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Currency traders on CNBC just now (Fast Money) making fun of Peter Schiff for saying that people are buying Gold because it is real money and there is little value in currencies because of worldwide central bank money printing.
I suppose you can get coconuts for trading different kinds of shells, until people are hungry and can't eat shells.
It's not the money printing that bothers everyone. It's who they are giving it to. The top 0.01%, of course.
but...but...you can't eat that stuff!
Warren says so.....
I bought 2 more $20 Liberty head gold coins yesterday for $1630 federal reserve notes each. I sold all of my GLD a long time ago.
you got it fred i don't know why this is posted here...keep stacking
Be careful with this ETF based on nothing physical (10%) just pure leverage...
Counterparty risk is huge for sponsor.
Imho is better to hold the physical gold than any quoted gold product.
On the other hand i still think gold is overvalued at least till EURUSD hits 1.18-1.25 (10-15%)
Also Applying a 50x gold silver ratio a 25 = 1.225------1.400 for me is the range for load gold, now is sell.
Regards,
There is much groupthink in the comments on this blog.
For some reason I find myself wanting to agree with you.
Ahhrrrr matey!
Do not mistake the inevitable congruency of enlightened thought with mindless groupthink.
Regarding the chart...145 is also a potential target for a bottom. The lengths of each downswing would be equal in points too.
Why the fuck would anyone here want to buy into that garbage. GLD and SLV funds custodians short the metal and drive the price down. Screw the FED and their god damn schemes to fuck with PMs through this bullshit. The only thing good about GLD and SLV is their effect on making physical metal cheaper.
I wipe my ass with GLD!!
GLD and SLV were created to make it easier to control PM prices. Actually investing in these tools... not recommended.
Please excuse this commercial break.
Can anyone offer any information about this or comment on what you think is going on behind the big white curtain in this live video?
http://www.youtube.com/watch?v=rmiq5CtF3N0
White curtains hide the Wizard of Oz or the carrying away of dead bodies.
??????????? =Fukushima Daiichi nuclear power plant travel camera live birth baby Godzilla eggs hatching most honorable
If he's using the GLD for the sake of charting give him a break - it is "similar" to physical gold and does give a measure of perceived value of those investing in GOLD even if some choose the paper ETF form.
The charts for physical gold are similar.
Banks and funds selling gold for cash and year end window dressing.
Market pumper on CNBC just now saying that Spanish Bonds have done better than Gold; so time to buy physical obviously.
Exactly.
GLD ... schmellGLD.
its an article on when to buy - which i have, big time.
i suspect all these head and shoulders patterns have been manipulated - we shall see.
who's buying this dip then boyz?
everycunt on zh has been talking big this last year.... now is the time.
BigDuke6
Who's buying the dip?.
DID YOU?
Like a bargain $2.00 Hooker,that should be worth $1,500.00 an hour Such a deal.
For the Uber wealthy here, I would hope you loaded up on Plat also.'12 is sposed to a bitch ride up for Plat.
No crying on missing this chance,you either pay to play/stay, or GETFO.
Yep
As mentioned above I've bought the dip... For the last time, I've done it for a while and it's getting too stressful,
I've gone all in.
And we'll see what happens.
I'm wasting too much time reading about this shit, I got kids.
And yep got myself some platinum too.
Happy ny if u get this
GLD is not Gold :)
If you can't hold it you down own it. Just do a few searches on MF Global and join the dots. I am thankful for the lower prices and I continue to accumulate real physical metals, slow and steady.
Read your GLD prospectus carefully if the SHTF you may only be eligible for currency equivalent. If I had the wherewithall i would insert pictures of Zimbabwe currency notes of 100 trillion.
Happy new year 2012 for all ZH readers.
physical silver will be an even greater set-up when GLD smashes against the rocks down around 120ish. Even then it's still a bull market in fact all the nibblers picking the bottom on this first leg down in here still need to get flushed with everyone else that will be puking up their positions to the banksters waiting to load up around that 1250ish level in gold. I'll use 120ish on GLD to signal my buy in physical silver.. or so I'm hoping.
Technical analysis is bunk. In economic terms, it's an inferior form of analysis, since anyone who actually moves markets does so based on either insider information or superior information - or arbitrage. Essentially, technical analysts just wank at markets and then look for patterns in the spooge.
Gold is gold. The market price fluxuates, but in a pinch, it's all that matters. A bit like ammo that way. It is power at key moments. Get it and forget it. If you have money, gold converts all that diminished marginal utility of income into security. No reason to even talk about it.
My Grand father was born in the Gold Standard and he remembered people paying things with Gold coins. Imagine you are someone living in 1910 and someone tells you that Gold is not money? Now imagine someone telling you that Gold "fluctuates"??!! You would look at your Gold coin in your hand to check if it fluctuates and the only thing that you would see is a Gold coin there still and doing nothing. GOLD does not fluctuate, it is the dollar which fluctuates. The only thing that the Gold "price" tells you is that the dollar is currently strong. Dollar is strong against euro, ringgit, real etc... People have been brainwashed with the wrong perspective.
That being said (and at the risk of being labeled a shill), considering the 95% debasement of the dollar since 1913, why should gold, fundamentally and without any speculative value added, be worth today any more than twenty times its 1913 price, or around $400? At least with silver there are arguments for impending scarcity and increased industrial demand, along with possible paper-physical price dislocation. And silver at twenty times the 1913 price is around $16, not too far from where it now trades.
Gold is pretty much used today for what it was used for in 1913, with the exception of not backing currency, so should be worth less than $400 until we return to a gold standard. To explain $1600/oz there need be a real or perceived shortage, or impending shortage. Is it possible that price has been manipulated up, not down? Are we oversold on the idea of gold as wealth preservation (over FRN's) without considering at what price gold is a reliable wealth preserver? I'm concerned the housing bubble "buy now or be priced out forever" cannard has taken hold of the PM market.
max, you are what they call, the weak hands. do a little simple research. more precious metals trade in a day, than all the metal mined in a year. it's a fractional reserve market, as admitted by jeffrey christian. 100-1
While GLD performance (via the graph) is an acceptable form of illustration for the article, I hope none of my fellow readers assume that GLD is an acceptable form of long term gold investment. Personally I have only held it for very short durations, usually hours, maybe a couple days, BUT THATS IT!.....
GLD and the other precious metal ETFs are subject to the manipulation of TPTB who are the edomite j-bankers & their minions. Many rumors are now circulating about the shortage of the physical material that is suppose to be backing up the precious metal ETFs...... and I image most of those stories are true.
Anyone invested in PM ETFs simply abets the manipulation of the metals.
'Nuff said.
True. Also TV viewers empower our overlords and keep us serfs. F TV and the banks pushing this paper gold/silver fraud.
TechnicalFake:
GLD = MFGlobal = Ponzi Bullshit = You play into these ETF SCAMS and you will lose your money and your Gold.
If you don't hold your PMs in your hot little hands you got nothing but empty paper promises which will be reneged upon.
Read the fine print of their prospectus... you fucking fool.
Have you learned nothing in the past few months?
http://goldprice.org/james-turk/2009/03/gld.html
GLD is a risky PONZI because its prospectus says that gold reportedly owned by the fund but stored in subcustodians and sub-subcustodians is not audited and cannot even be inspected to ensure that it really exists.
Nor is it insured.
Further, the prospectus allows for the possibility that all of the gold supposedly owned by GLD is subject to the considerable numerous risks spelled out on pages 6 through 13 of GLD’s prospectus, including the significant risk that “Shareholders do not have the regulatory protections provided to investors in investment companies.”
Paper GLD SLV (and currencies) are abstracts, not real, a social(ly) constructed believe system of "trust". I can not help to not trust something that is Not Real!
Yeah that "trust", rule of law, bankruptcy law and private property rights worked out real well for GM Bondholders and MF Worldwide account holders. MFW also did clearing for online brokerage firms options trades like eTrade. People who had money their lost it and may get some of it back.
Here's one for those who have the opinion that the U. S. Gov't will confiscate gold at some future date. Why confiscate it when they can just pass laws to control and manipulate it? From Ed Steer today:
Japan's new tax law prompts bullion sales spreeA new taxation law in Japan has triggered a bullion sales spree among gold investors at the end of the year despite sharp falls in gold prices, dealers said.
From Jan. 1, bullion retailers are required to report to tax authorities physical gold and platinum transactions of over 2 million yen ($25,700) with members of the general public, said a senior official with a large bullion house in Tokyo.
Bullion houses stayed open on Thursday, even though it was a public holiday in Japan, to receive investors who wanted to sell their physical gold holdings or swap big chunks of gold for smaller lots, such as coins.
This Reuters piece was posted on the news.yahoo.com website on Thursday...and I lifted it from yesterday's King Report. It's a must read...and the link is here.
Rocky
Why worry about that?,all the IRS has to do is go into any Dealer, and say we're gonna audit your books.
Got the names, and SS, and all other info needed NOW to do the same.
Time for Fukishima Land to move metals.Got that kind of stash, rent a plane and go to Nam, and sell for a 50% premium.Or Hong Kong............for less.
somehow the words 'gold' and 'GLD' just do not go together .... paper gold is just paper ....
disclosure --I sold all GLD and own things like CEF ( Central Fund )
Greg
I disagree. GLD trades at a slight discount to physical gold, so in my view, it is almost as good as gold. Just Kidding....
I sold GLD and also hold CEF
No offense to either you or the commenter above but:
-You both 'hold' CEF
-I 'hold' GLD
IF u think ur fantasy is better than mine then lol.
We both have to login to get our gold. Don't seem all that legit to me.
http://www.youtube.com/watch?v=Ahha3Cqe_fk&ob=av2n