Topic: Whose wrong: Gold or Treasuries? (Read 2073 times)

i could be.  i used to rely more on fundamentals but now look at what the charts are doing to tell me whats really going on underneath the surface.  read my thread i just put up:

https://bitcointalksearch.org/topic/whose-wrong-gold-or-treasuries-35493

I personally feel your underestimating the buying power of India and China. Both countries are making a big push to get their citizens to buy gold. In India you must have gold for the wedding and in China it is everywhere according to a penpal that they mention gold as investment (due to their high inflation).

my bet is gold/silver begin the long decent after FOMC.

Looks like the Feds are going to have a "lets print money meeting" and DOW is up , silver down, gold ticking up slowly. IMO Great buying time if silver hits 35$

It's raining red right now. There was no statement of buying gold at this point. I had recommended silver instead. The general premise is merely that being short gold is extremely dangerous at this point, while being long you can sit and wait for the price to rise. Also beware of a divergence between the paper and physical markets.

Gold and stocks are completely different animals.

Silver is tied to industrial uses that will drag it down on economic slowdown expectations and it can act as leverage to hold gold back, but not indefinitely. It still has a historical purpose as money alongside gold.

Gold has broken to multiple new highs, but the dollar is still range-bound. Why?


Patience

A better trade would be long gold/silver and/or mining stocks and short the equity indices.

* Note that gold has formed a double top on the short term charts (1hr or shorter) after a push down from ~$1770 to ~$1730. The $1650-1680 range is the initial target followed by $1600 and $1550. Any spike down from here on out will be met with immense buying, so the drops will be very short-lived. Trade short at your own risk; I recommend buying physical metal.

It's a pity that I bought lots of silver and short some gold, although I'm overall long in PM, that do not bring me profit due to the sluggish trend in silver

When do you predict the end of gold?
Its at a new record of 1755 right now on the spot market

http://www.kitco.com/market/

did anybody just notice the bitcoin ramp?  what if USD's start rotating out of gold and into BTC?  we are on a Bitcoin forum after all.

never buy parabolic blowoffs.  buy when there's blood in the streets.  now is not the time for gold.  when deflation really kicks in (and there's no sign of the PPT) you could wake up and gold could be down hundreds of dollars and headed back down to $500 w/o a chance to get out.  just look at the Dow.

edit:  for clues look at silver.  and the USD has not broken down out of the channel yet.

Yes, it's definitely price deflation across equities and the entire commodity sector right now - brought on by panic selling with a rush to cash. So why is gold taking off alongside treasuries, the typical safe-haven?

With a mindset of deflation taking center stage, it's a perfect set up for highly inflationary measures to be taken by money-printing central banks under the guise of 'saving the system' or, as Goldman Sachs' Lloyd Blankfien suggests - doing 'God's work'.

I don't know what the Fed statement will be tomorrow, and it doesn't really matter but for short term hysteria. The simple matter points to deflation causing extreme hardship and a desire for valuable assets that won't depreciate, including gold (how many citizens are even aware of treasury bonds)... or inflation that debases the domestic currency, making other assets much more valuable, particularly gold. Win-win for precious metals, rock-and-a-hard-place for the US hegemony. Politicians can be relied on to take the easiest way out, like clockwork.

If everyone is being led to believe that a parabolic blowoff is due for gold, then that's what will be presented. All the suppressing banks have to do is let some pressure off and gold will bolt like a racehorse out of the gate until they have enough physical metal to return to holding the price in check. That will be the sharp selloff. Then the headlines will suggest yet again that the bubble has popped. I've seen too much chart painting at low-liquidity times over the past few years to rationalize any other explanation.

Keep in mind that a double top or gradual rollover pattern is not indicative of the final high. Instead, watch for gold to establish a new trading channel with a higher angle of ascent from the one formed over the past decade. The price will definitely be highly volatile, perhaps $100+ range per day, but the overall trend will still be ascending.

I am actually expecting gold to be driven down overnight or early tomorrow ($1760/oz now), prior to the FOMC meeting. Remember Bernanke's announcement of QE2 last year? There was a spike down in price during his broadcast, then prices took off and never looked back. Be quick if you trade it. Any hint of even slightly relaxing policy, whether it's announced now or later this month, and it's off to the races. What do you think the debt ceiling was raised for?

How are treasuries valued? How are equities valued? How is gold valued? Which can be exchanged on-the-spot with no intermediary, or accepted as collateral with no questions asked? Will the true reserve asset please stand up?

you being a professional in PM's, if you can tell me you bought metals btwn 2005-2007 as i did then i can have more faith in what you say.

the afterhours are showing Dow down another 175 and silver down 1.38% and oil down 5.47%.  the ferociousness of this selloff portends deflation to me and i still think it drags gold down with it very soon.

my bet is tomorrow the FOMC doesn't mention a thing about further QE and perhaps then gold will take a hit.

everyone expects a parabolic blowoff top to gold after another doubling or tripling of the price.  lotsa ppl thought the Dow would do the same thing.  no dice.

If management (read: printing) of a currency were the key to prosperity instead of real effort (farming, engineering, manufacturing, etc), we could all print our own money and live like kings.

Bernanke and company are doing their best to prop it up, avoiding a very painful waterfall-style crash. The dollar's decline is being controlled as best it can.

I do admire and appreciate the goons for their skillful machinations and preventing complete social disorder, but still consider them fools for having allowed the situation to get as bad as it is.

how do you know they're not trying to manage it back up?

tomorrow will be a big day and tell about what the FOMC will do in terms of further QE.

It is absolutely impossible to get the gold price down if they keep printing money! a-la "quantitative easing" or whatever they want to call it

It isn't about getting the gold price down. We're in the midst of a highly-controlled asset revaluation. Dollars have become untenable, but nobody wants the system to collapse catastrophically. It's the dollar that's being managed down.

i think you misjudge the urgency for the Fed to get the gold price down.  in your scenario, the USD must tank to oblivion and i think thats the last thing they want or will let happen. 

Regarding the USD - inflationary efforts have caused it to become highly undesirable for major foreign holders of US debt. They are using the equity sell-off as an opportunity to supply dollars in exchange for valuable assets. This is why the dollar is in a range instead of having taken off due to increased liquidity from domestic fire sales in assets.

I think the 9-year cycle concept is too myopic. Gold moves based on influences with far greater scale than 9 years. Add to that the fact that it has been suppressed for so long that short-term cycles will be severely distorted and eventually snap back to the fundamental trend; reversion to mean.

Yes, there are many associations in asset classes that will shift rapidly. It's going to be difficult to keep up with them as they accelerate. Foreign exchange rates are already fluctuating by 100-200bps per day. Gold will entertain another mini-blowoff, most likely before November; a crash will follow, probably to the $1600/oz range after attaining $2000-3000/oz or better. Pundits will again claim that gold is in a bubble.

However, look at the 10-yr chart - gold has followed a very consistent upward trending channel which is developing the base of a very long-term parabolic rise. It will take several more years to play out. The precious metals are nowhere near bubble territory yet. The bubbles I see are in equities, treasuries and the US economy in general.

I am projecting about 3 more years for the next phase of gold's upward revaluation, followed by another phase for about 1 year, then a peak within 3-6 months after that. Each phase will at least double the price of gold as public awareness and intent to acquire the metal grows.

Around late 2015 to mid-2016 should be the final stage of US economic capitulation and gold's rise to dominance in the international financial arena. It will act as the foundation of a floating associative rate with all surviving currencies at that point, possibly including Bitcoin.

the only thing i'd add here is that relationships can change btwn asset classes in unpredicatable ways.  for instance, its possible for everything to decline incl. gold and bitcoin to rise from the ashes.  this is my bet.

in fact i think the relationships are hinting at a shift.  the USD should have rallied hard but is stuck in a consolidation pattern. 

for these reasons i also like to look at each individual asset and try to assess whether it over/undervalued, in a bubble or not, and also what part of the cycle we're in.  for instance, some think that gold has a 9 yr cycle which obviously has extended at this point. 

another factor is that even if the above relationships may hold, they may not all move at the same time. for instance gold topped 4-5 mo after the Dow back in 2008 as did the miners.    i think this is a phenomenon of short seller/sellers rotating in and out of sectors selling them off one by one.  this is my concern for gold right now.  we're about 3 mo post Dow rollover.  gold is going parabolic into a blowoff maybe.  then crash.