Category Archives: GOLD

Gold Miners … Going Short

December 3, 2021 By in David Weis, DUST, GDX, GLD, GOLD, Gold Miners, Positions, Prechter 2 Comments

The Battle From The Trenches

To date, there’ve been 232 transactions in the firm’s main trading account.

Each one has its own story.

The big one for now, is shorting the gold miners GDX, via DUST (not advice, not a recommendation).

We’re going to pull out the ‘card catalog’ on that one and take a brief look.

As a reminder, this post identified the breakout target for gold (GLD), months before it actually happened.

Also, in a prior post, it was discovered the miners had 3:1 downside response to recent down moves in gold.

Therefore, at this point in time, using leveraged inverse fund DUST, at -2X, the miners, gives an estimated, 6:1, market exposure.

Short entries were opened (shown below) once the gold market and miners broke to the upside.

Hysteria First

Those who’ve been here a while, already know part of the short set-up, was the necessary hysteria needed to get nearly everyone on the wrong (bullish) side.

Senior Miners, GDX

Just for reference, the daily chart of GDX, is below.

The arrow is the last known transmission of the gold bulls.

Early in the morning it was (6:30 a.m.).

I suppose it must have been from behind enemy lines, with one of the gold updates warning us about archrival, Russia.

As we can see from the price collapse, the Russians must have found our gold bulls. 🙂

Meanwhile, Back At DUST

The daily chart of leveraged inverse DUST, shows trade entry locations to date (not advice, not a recommendation).

The hourly chart below, gives a closer look.

The next chart is a zoom-in of the entries.

Positioning in this market for now, is essentially complete.

At this point, it’s time to monitor and track for any potential trend reversal or trendline break.

Early Or Late

Years ago, sometime around late 2007, or early 2008, Robert Prechter Jr., said concerning his trades, he tends to be a little bit early.

That implicitly means he might suffer through adverse action including loss-exit, if action goes counter enough.

There’s no perfect entry. Early or late, take your pick.

Fixing Entry Errors

As can be seen on the hourly chart, every trade entry was on a red (declining price) bar.

The risk is, price action will just keep on going red.

The benefit is a big one; I’m not chasing the market.

If I’m chasing, it means I’m not on my game or I never had a game or worse, a coward that can’t pull the trigger on a trade without more ‘confirmation’.

David Weis covers in his video, how to properly get aboard a market that’s already underway.

After the initial entries, DUST banged around the bottom (GDX at the top) for eight trading days.

In retrospect and looking at the chart, the adverse action was not much lower but it did not feel like it at the time.

Because of the months of planning, there was an inference the size of this reversal would be significant.

So far, it is.

In the process of reversing, price action itself has fixed trade entries made a little too early.

Summary

Future updates will show potential trend and/or channel action as well as Fibonacci time correlation.

At this point, the DUST trade is well underway.

A reasonable stop area would be in the vicinity of DUST 19.37 (not advice not a recommendation).

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold … ‘Gut-Check’

November 30, 2021 By in David Weis, Dr. Elder, GDX, GLD, GOLD, Gold Miners, Positions 4 Comments

To See If You Can Hang On

Gold’s upside test has failed.

Now, it gets interesting.

Over the past four trading days, the gold market got slow and boring.

On top of that, we had Thanksgiving; providing more opportunity to be asleep at the wheel.

As Dr. Elder has said, when the market gets slow, traders start ‘squinting’ at their screens and imagine set-ups that aren’t there.

They forget (in this case) we’re in the middle of a potentially significant, long-lasting downside reversal.

All of this provides the conditions we saw at today’s open. A swift upside ‘gut check’ as David Weis used to call it.

It terrifies the weak hands

They either close out shorts, go long, or both; confused as to the real direction of the market.

How do I know? I’ve done it myself

Such a move, is typically what happens just before a market gets underway in earnest.

Gold (GLD) and the Miners (GDX)

We’re looking at the daily GDX, inverse fund DUST.

The chart below zooms-in on the trend contact points.

There’s a caveat to more GLD and GDX downside.

While gold has made a new weekly low, the miners, GDX, have not.

That leaves the possibility for some kind of upside action; although at this point, it’s low probability.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

The Future’s So Bright …

November 23, 2021 By in DUST, GDX, GDXJ, Genesis 41, GLD, GOLD, Gold & Silver, Gold Miners, Jerimiah Babe, Van Metre 1 Comment

… I’ve Gotta Raise Rates !

That’s right. The economy’s so good, we’ve got to raise rates.

Well, almost.

First, there’s more aggressive tapering … then we raise rates … honest.

No, this isn’t an MTV video from the ’80s … it’s the Fed life.

The latest update from Steven Van Metre, has comments from the Fed that seem like they’re from another world, another time.

Evidently, the economy’s so strong … so good, that we might taper more aggressively and then … raise rates.

At this point, ‘what difference does it make?’

They’ve probably already cashed-out (like last time) and now stand on the sidelines.

Meanwhile back at the proletariat, we’re deciphering the market’s next moves … Fed press releasees notwithstanding.

Is Gold (GLD) The Black Swan ?

Frist off, there are several YouTuber’s that are providing an excellent service; letting us know the real state of the economy.

They are invaluable; thus, receiving their fair share of hate from those that don’t want to hear, see, or smell, ‘bad news’.

All of them willingly admit, they’re not experts when it comes to the markets … fair enough.

However, in Jerimiah Babe’s latest update, he may have unwittingly revealed a (or the) black swan.

Gold and the gold market.

JB’s offered the anecdote of attempting to purchase more gold at the dealer. For the first time ever, he was limited on the amount available.

From a market standpoint, the public, is all-in.

Even as we speak, gold (GLD) and the miners, GDX, GDXJ, are in a vicious downside reversal.

At this juncture, it looks like an upward test of resistance (discussed yesterday) is nowhere in the cards.

Price action for the most part, is straight down.

Which brings us to the charts.

GLD, Weekly Chart:

Marked up with resistance and the up-thrust reversal.

Zoomed area of the reversal

Personal Opinion:

Because the gold hype by the financial press was so incessant for so long (which by the way, has strangely ‘disappeared’), this reversal may be something that lasts much longer than anyone would expect (not advice, not a recommendation).

Downside Targets:

The weekly GLD chart below has a Fibonacci projection tool overlay.

A 161.8%, projection would take GLD down to 119 – 120.

Are the gold bulls prepared for an extended downside rout in the metals?

Summary:

Early morning food production.

It might not look like it’s connected to the markets but it is.

Market analysis presented on this site, helps steer actions needed to separate from (or reduce reliance on) the system.

Properly executed, trading is one avenue to provide income that’s necessary to eliminate the need for a corporate employer (not advice, not a recommendation).

Market analysis also helps identify what’s likely to come next.

But, I digress.

Getting back to the coop; four eggs a day … equates to over two dozen a week. Reliance on the grocery store (at least for eggs) has effectively been eliminated.

About a year’s worth of feed has been stockpiled.

Let’s put it a little differently; a year’s worth of feed has been ‘stacked’.

Personally, I like gold and silver as much as the next guy.

However, those in charge of this collapse have already stated, food will be used as the leverage weapon.

But hey, we shouldn’t have to worry about any of that, because, ‘The future’s so bright …’

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold Bulls, Trapped !

November 22, 2021 By in DUST, GDX, GDXJ, GLD, GOLD, Gold & Silver, Gold Miners, Positions 9 Comments

Stunned … Unable To Move

It’s not supposed to be this way.

What about all the ‘money printing’ driving the dollar to extinction?

What about all those telling me $3,000/oz, in months, not years.

For today, it’s just not happening.

Adverse moves in gold (GLD) like we have right now, especially after months of incessant hype, puts those who bought into the narrative on the wrong side; stunned, unable to move.

There’s a small chance, this could be a shakeout before going higher. Anything can happen.

However, if we look at the chart of GLD, it’s a grim situation for the bulls.

Gold (GLD)

Daily chart, GLD:

This wasn’t just a one-day push above resistance and then reversal.

GLD, spent a Fibonacci 8-Days struggling to break out before this morning’s collapse.

Stunned bulls may think it’s a buying opportunity. If so, there’s likely to be some kind of underside test of resistance.

However, that’s not guaranteed. Moves like this tend to offer no relief and just grind their way lower.

Positioning:

At this juncture, we’ve got a nasty adverse move; putting the short position (DUST) well in the green (not advice, not a recommendation).

Any upward test of GLD, and the miners, GDX, GDXJ, is likely to reveal new support/resistance boundaries and possibly trend-lines.

If so, we’ll have something to monitor for a potential exit signal.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Silver: Leading The Way, Lower

November 20, 2021 By in GLD, GOLD, Gold & Silver, I Allegedly, Jerimiah Babe, SLV

Already Below Resistance

While gold (GLD) is just above its resistance breakout, silver’s not waiting around.

It’s already below its breakout; apparently leading to the downside.

Using ‘boots on the ground’ type reporting from sources like Jerimiah Babe and Dan (I Allegedly), the financial collapse is accelerating.

The metals look like they’re not exempt from financial conditions (deflation); they’re at the cusp of reversal.

Silver (SLV) Daily Chart:

The next chart zooms in on the reversal area.

It’s clear; SLV is now below resistance … a bearish indication.

At some point and if you live long enough (and have a working brain) you realize it’s all about manipulation.

Everything is manipulated.

Separating from that trap is akin to mental bravery; setting you apart from the mindless herd and at times, in opposition to that herd.

Silver (SLV) is down a whopping -53% from its high set over a decade ago in April of 2011. How can we be in inflation or hyperinflation?

That’s to come … maybe.

Right now, silver’s giving us a signal; lower prices ahead.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

… And, More Gold Bulls …

November 19, 2021 By in DUST, GDX, GDXJ, GLD, GOLD, Gold & Silver, Gold Miners, Positions, ZeroHedge

Nascent GDX Reversal, Gathering Steam

Packed in like sardines, the gold bulls just keep on coming.

Once again, the latest from ZeroHedge:

Von Greyerz: Gold-O-Mania Is Coming!

The author is “convinced” gold is going to end the year higher than it is now.

Well, it could.

Does that mean the miners are going to end higher?

Gold Miners, GDX:

A marked up chart of leveraged inverse fund DUST (-2X GDX), is below.

Chart is on the 4-Hour scale:

We can see a potential trend.

When that area is expanded with contact points (below), it becomes even more convincing.

The actual metal, gold, may indeed rise over the coming months.

However, today, GLD is retracing to support. What happens now, is the key.

Bounce and continue (higher), or bounce and fail.

Positioning:

The short position via DUST (not advice, not a recommendation) was opened at the danger point when the direction of price action was unknown.

From the post on November 10th:

“As of this morning, we’re already positioned short this sector via DUST (not advice, not a recommendation).”

DUST has since moved higher (GDX, lower) and the trade is well in the green.

That means one can watch the battle take place at support for GLD, GDX and resistance for DUST from a (somewhat relaxed) position of profit.

Summary:

The final outcome of this short-trade is of course, unknown.

However, one of the objectives of these posts is to document the level of research and preparation involved for a ‘position’ trade.

Going short has been two months in the making.

From the initial ‘GLD Target‘ post to now, we’ve seen manipulation of GLD, GDX price action; making it look like a breakout was imminent.

That action was coupled with non-stop financial press herding of the easily influenced to the bull side.

How can it not be coordinated? Remember this post?

So, it looks like the bull trap has been set.

This trade could still fall apart for some unknown reason.

If it looks like the bulls are somehow re-gaining control, it will show up in the price action and we’ll exit accordingly (not advice, not a recommendation).

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold Bulls Continue On

November 18, 2021 By in DUST, Ed Seykota, GDX, GDXJ, GLD, GOLD, Gold Miners, Positions, Wyckoff, ZeroHedge

Even As The Miners Reverse

After attempting to breakout higher over the past six trading sessions, the miners are posting signs of a nascent reversal.

Even so, the bull calls continue.

The latest round includes two more articles from ZeroHedge:

Gold Breakout Imminent !

The first part describes some technical details that are all true … after that, well, you decide.

Turns out, gold is going to skyrocket because of Russia !

I suppose, anything can happen.

We get fundamentals and anecdotal data as the reasoning for a Russia driven up-side breakout.

The problem with fundamentals is, they don’t work.

They never have worked.

Wyckoff discovered this a century ago when he said (from his autobiography) that ‘stocks move based on a power of their own. That power, has nothing to do with fundamentals.’

Trading genius Ed Seykota repeated that truth during his interview for ‘Market Wizards’.

He called them ‘funny mentals’ and went on to say he nearly, if not always lost money using them.

Gold shhh …

This article’s so good that I have to pay to read it.

From reading the shaded area, we can infer a similar (bullish) discussion to the first link above.

Sorry, not interested.

Summary

This time really could be different. Gold could launch into a sustained upward breakout.

However, the charts (GDX, GDXJ) at this juncture, are saying ‘not yet’.

Maintaining short (not advice, not a recommendation) via DUST … which is now in the green.

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Tech Talk, Gold & Gold Miners

November 17, 2021 By in DUST, GDX, GDXJ, GLD, GOLD, Gold Miners, Positions, The Speck, ZeroHedge

Trend & Channel

Who’s taking the bull side on gold?

If we use the just released ZeroHedge articles listed below, the inference is the average investor’s on the bull side:

Investors overweight in stocks

Gold probes multi-month highs

Futures flat amid inflation jitters

Especially notable in the ‘Gold probes’ article is the statement, gold pushed above ‘key price resistance’.

That key resistance was first identified in this post as the target for potential major reversal.

This Is Now

So, here we are.

Gold (GLD) and the miners, GDX, GDXJ, have pushed above resistance levels. The bull/bear fight is on.

At this point, it’s not known who’s ultimately in control.

A retrace to breakout support for gold (GLD, GDX, GDXJ) is normal under either circumstance … bullish or bearish.

What happens at that support is the deciding factor. A bounce and continuation upward, the bulls are in charge.

A bounce, then failure, nods it to the bears.

That’s why we’re at The Danger Point.

It’s the location where price action hesitates. It’s unsure and can go either way.

The weekly chart (below) of GDX, is marked up with a modest sloping down-channel … declining approximately -26%, annualized:

From left to right, that right side contact’s been in the making for over a year.

Even worse (for the bulls) is the next chart:

Note the right side channel is an estimate and has not been confirmed with additional contact points.

We’ll zoom in on the possible new channel:

Price action made several contacts with the grey centerline and the entire channel structure looks symmetrical.

‘Transitory’ & The Elephant

The reason (supply chain) inflation may be transitory is that demand is going to collapse.

It’s already happening.

Now, that news is just starting to hit the mainstream.

They pretend like they’re not sure what’s it’s all about. So, let’s help them out with some facts.

Embedded within the article at this link, is an actual list of ‘strange anomalies’ that are occurring amongst the most athletically conditioned in the world.

If it’s happening with the athletes, it’s happening in the rest of the population.

Summary:

Early this session, Gold (GLD) and the miners, GDX, GDXJ have, or are testing their highs with inverse funds DUST and JDST testing the lows.

If this is a major transition from up to down for gold and the miners, this type of back and forth is normal.

Positions:

We’re still at the danger point but action can’t stay at these levels for too long. If it does, that would imply the bulls are gaining control and going to move the market to much higher levels.

Obviously, since we’re short (not advice, not a recommendation) via DUST, we’re on the other side of the gold bull trade.

A reasonable stop for DUST would be at, near, or just below yesterday’s low of 16.72 (not advice, not a recommendation).

As of this post, with DUST currently trading at DUST, 17.11, my firm’s position is down a modest – 1.82%.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Gold Miner’s, Terminal ?

November 16, 2021 By in DUST, GLD, GOLD, Gold Miners, Positions

Possible Reversal In Gold Futures pre-Market

We’ll get straight to it … Gold futures, GCZ21 (December) look like they have posted an up-thrust and reversal in the early hours.

The Miner’s chart above, GDX has a potential terminating wedge as shown. The chart below zooms in on that area:

Pre-market action thirty minutes before the open has GDX about to open slightly higher.

If we’re in a reversal condition, the expectation is for the higher open to be retraced within the first 4-hours of the session … preferably within the first hour.

If price action persists higher, it’s an indication there is more oscillation to come and it’s probably time to stand aside (exit) a short position (not advice, not a recommendation).

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279

Bears Throw In The Towel

November 16, 2021 By in DUST, GDX, GDXJ, GOLD, Gold Miners, TSLA, ZeroHedge

A Tale Of Two Bears

Back in the day during the dot-com boom, fund managers were throwing in the towel (‘value’ fund managers, if memory serves) because the markets as they said, “did not make sense anymore”.

Valuations were insane and managers with decades of experience decided the time had come to exit for good.

Of course, it was a contrarian indicator. Those lofty valuations and prices were at or near their peak.

It was not long after when the market cracked. There was a rebound of sorts but the stage was set for a long bear market.

History Repeating?

This is a brief update to document two bear managers that are quitting in separate ways.

One is shutting down his fund entirely. More information linked here.

The other has exited short positions which included getting out of Tesla (TSLA) just before it rolled over.

These types of high-profile events usually happen at or near a significant top.

If the overall markets continue to grind higher, there may be similar retirements and/or fund closures.

Gold (GLD) Update

Before a market can reverse to the downside, it has to stop going up.

Sounds obvious but with the bullish hysteria on gold, coupled with non-stop inflation talk, it may take a while for the bulls to exhaust themselves.

We’re still at the danger point for GLD as well as the miners GDX, GDXJ.

Items of note for the session:

GDX had a double top (same high as Friday) and the inverse fund DUST posted + 0.01, above its own Friday low.

It could mean we’re at the extreme(s) with no more directional thrust or just a pause before continuing with the existing trend.

Stay Tuned

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

The Danger Point®, trade mark: No. 6,505,279