THE SECOND SHOE DROPS

                                     Gold Looks Good Huh?

With the world in the condition it is in, how many more $40 drop [or more] “shoes” are still out there waiting to be liquidated? Mind-numbing boredom in the gold trade day-after-day for weeks; then Boom! All it took was 7 5M candlesticks and it was mission accomplished.

I’m going to repeat this because I think it is important: forget the Central Planners for a minute [if you can]; think more about the GLD. GLD is the ETF [exchange traded fund] that is in the top ten of gold holders in the world. Gold has been higher 11 years in a row. The market is now within about $40 - $50 of the 2011 close [1563].

What happens when all the “Ma & Pa Kettles” of the world decide it’s time to take some profits from holding gold the last [pick a number between 1 and 11] years. How does GLD sell [within two days for settlement] tonnes of gold into a weak market without absolutely killing it lower? And if that happens, won’t lower prices induce more panic selling?

Fact is, since the GLD was formed gold has been higher every year. Maybe, just maybe, we get to see what happens when the other 800 lb. gorilla in the room gets seriously grumpy and needs to sell. Think it could get a little ugly?

“Oh boy.”

Everybody [meaning blogs and pundits] talks about the day when there is no offer and gold is bid at $3,000 / oz. and there are no sellers. OK, how about when you wake up some morning and Europe is wall-to-wall riots and gold is $350 / oz. lower? If you own gold and the GLD is selling 1,000 tonnes of gold with more to come, and you own some gold yourself, what do you do? You gonna just sit there? [Maybe, but I doubt it. Why do you think it is called panic selling?]

First and foremost I am a trader. When I come to the trading table [pit or electronic] all my senses are on alert. I don’t buy hype; I try and look at things objectively and the quickest way I can make money via the algorithm. Right now, gold looks very, very sick and reminds my stomach of the early 1980’s. Talk then was exactly like it is now.

Maybe gold goes ballistic from here and ends 2012 at $3,000 / oz. All I’m saying is be prepared for something a lot lower than where we are at now.

Opinions kill.

Have a good day everyone.

-vegas

GIVE ME SOME BORING

                                 Gold Makes A Statement Today

Ranges in pretty much everything you could possibly trade today were muted and the massive $8 highlight reel in gold can only be viewed in the context of “collective fear of the 800 lb. gorilla”. Who wants to get caught on a Friday with the manipulators manned and ready? Apparently nobody.

Any other rational explanation of gold trading today would ultimately lead to insanity, and since it’s Friday, I really don’t want to go there. Now, if it was a Monday …….. ahhhh, never mind.

In the event you actually have a life, and like me desire to giggle a little before you completely forget gold even exists over the weekend, I bring some Friday chuckles before it’s time to say “adios”.

Hopefully one of these got you to crack a smile and remind you that there is more to life than trading stupid gold on a stupid Friday with a stupid range.

“That was a stupid rant.”

“You're Welcome.”

Have a good weekend everyone.

-vegas

P.S.

Updated daily cycle charts over on the PAMM page at the end of the day. Just follow the link:

http://vegaspamm.blogspot.com

THE 800 POUND GORILLA

                                         The Key To Victory

Q: The 800 lb. gorilla is very hungry and wants to eat. What do you give him?

A: Anything he wants.

With Europe about to go off the cliff, what with the new “austerity” in the PIIGS zone, bond yields climbing, and economies diving into recession, of course the Euro (EURUSD) must be manipulated by the ECB; we simply can’t have a currency crisis right now. 

[ http://www.zerohedge.com/news/bis-fxgold-intervention-profiles-and-after ]

Before I ask this next question, please don’t think it is rhetorical. Is there any financial market not being manipulated by some government?

Seriously, I think the answer is no. Which brings me full circle back to gold. I wrote in the updated algorithm manual [which you can download for free at the link “Get It Free”] that there are 3 main objectives to government manipulation of gold: 1) keep gold out of the news, 2) hurt as badly as possible all retail speculators [long or short], and 3) make the manipulation count [on the charts].

Since the middle of 2011, the stakes have been seriously raised by the “central planners”. Things are spinning out of control on the fiscal and monetary fronts; trillions of dollars have been thrown down the proverbial rat hole, and don’t think for a minute these guys are going to back down: the manipulations will get bigger and bigger as time moves forward.

Today is a perfect example when you look at gold. Smacked down hard very late in the day on Friday (over $10 / oz), together with another $15 on the down side in Asia to start the week, you got about a $25 move lower on the lowest volume imaginable. So how is that possible?

But wait, the game isn’t finished for the day yet; oh no, they have to destroy some retail specs first, and that comes with the allowed rally to a new high for the day to drive the shorts out of the market with their buy stops. OK, we get a new high by a few pennies, the shorts have been squeezed, now what?

Easy peezee. You smack it down hard to near the low in the next 50 minutes. And from there very little happens; trading dies for the day, as the market limps into the close, the high finally safe from assault in their view. This is how a “normal” market trades? [Ha ha ha ha]

Remembering what I said earlier, ask yourself if the 3 main objectives have been accomplished? Sure have, and in spades.

The difference between all of us traders and the manipulators is the fact that we are in the market to make money and they could care less; they are here to wreck havoc and target a price. It doesn’t matter if they lose billions, they just print what they need, and besides it is chump-change compared to what the objective is; keep the current U.S., Europe, and Japan financial ponzi schemes alive.

Trading can be simple, but it is never easy. Guessing what the central planners do [with JPM front running the whole process] can be tricky, but never think they aren’t there.

Have a good day everyone.

-vegas