Speculative Alert Flag to Yellow
Note: This commentary was originally published at Metal Augmentor on Friday, May 29, 2009 at 1:18PM EST.
Some of you who have followed www.silveraxis.com in the past will know I have sort-of-a-system called “alert flags” that I use to express my net positioning in the PM markets with respect to given time horizons. These “flags” essentially indicate how I am personally positioned to take profits in the future.
Well, this morning I have switched the “speculative” flag to YELLOW, indicating that I now have a rough balance between buying and selling over the next 3 months. In effect, this means I am in the midst of reducing my speculative long trading positions and/or increased my speculative short trading positions. Readers of Metal Augmentor will get more information shortly on some of the specific trades I have made to reach this point.
In effect, what the YELLOW flag means is that I expect an increase in volatility where trading should generate better returns than a simple buy and hold strategy. If the flag is accurate, I should be able to establish new speculative long positions within the next 3 months at better prices while taking profits on both speculative long and short positions in the meantime. This is probably very confusing without an example and as such I understand that the YELLOW alert flag isn’t very useful. As I’ve noted above, probably the best way to interpret it would be a period of increasing up and down price volatility that traders can best take advantage of. In comparison a GREEN flag would mean a period of trending up where buy and hold would be the best strategy and a RED flag would mean a period of trending down where either no position or a net short position in the market would be expected to perform best.
I continue to maintain GREEN flags for all periods over 3 months, indicating my ongoing belief that we are still in a bull market for silver and that there should be opportunities to generate investment profits from long positions held over longer timeframes than 3 months.
If I did “raise” a RED flag at some point, it would mean that I have not only disposed of the majority of long speculative, trading or investment positions (depending on the time period) but also that I have gone net short. In retrospect, a RED flag would have been a great call last July but the truth is that while I did have some defensive short positions, on balance my speculative portfolio reflected more of a neutral stance than an outright bearish one.
CAD gold has been correcting since February 23rd. The correction ended on Tuesday, June 2nd, so here is now a Green Light.
@Kipling
I’m with you, as I’m priced in AUD. We have gone from AU$1500 at the end of Feb to about AU$1200 now. I sold speculative positions at the end of Feb as they were bought at sub AU$1000. Looking to re-enter spec positions at about AU$1000. If gold breaks US$1030, without a significant decline, I’d have my spec pos back in a flash at aprox break even. I just think that there is a “bridge” to cross before Aug-Sep when the next run is expected as the true magnitude of this financial crisis becomes apparent to the mainstream. The core is off the table.
Professor Platinum’s gone parabolic. Can you say, “Signal failure”? A textbook handle on the cup and then a moonshot, jumpstarting silver. The Germans must be freaking out right about now.
@Lone Ranger
Except for the $-index the losses of yesterday were undone today. Does anybody has a reasonable explanation for this? Otherwise, I would call it a trial run or a shot across the bows for the (PM-) speculators.
Anyway, such moves make it difficult to set an exit or entry trigger point for any short-term Ag/Au strategy. I stick to the long-term investment based on the fundamentals.
Normally I read Jim Willie’s commentary with a healthy dose of skepticism, however he has made several very good calls in the past. I recently ran across a very interesting article that provides some circumstantial evidence to justify his claim that the Germans are demanded the return of all gold held in custodial accounts in the U.S.
http://news.goldseek.com/GoldSeek/1244050251.php
Road to Roota XIV
By Wix Beir
“I was watching the NBC special called “Inside the White House” last night and was struck by a meeting with Larry Summers and the President.
http://www.msnbc.msn.com/id/30892505/#31073805
It was touted as an “all access” day in the life of the President but at 7:15 minutes into Part 1 Larry Summers and a man who I believe is Austan Goolsbee come into the Oval Office for a call with “the Germans”. Summers is obviously on edge and shuts down the cameras when he begins to discuss the problem.
Summers: “Life has changed..ahh..since the briefing…ahh”
Obama: “For the better or for the worse?”
Goolsbee: “Net-net for the better…wouldn’t you say Larry?” (Goolsbee speaks loudly and unconvincingly for the cameras.)
Summers: “(nervous laugh)..there’s elements of both. The Germans…actually we should stop (the cameras) here.”
The cameras and staff are quickly “ushered out” of the Oval Office.
For those who don’t know, Austan Goolsbee is on the Presidents Council of Economic Advisers and is touted as Larry Summers’ “Economic Internet Guru”. In that capacity there is no doubt in my mind that he monitors all the gold internet sites as well as being in charge of coordinating all the “gold disinformation” articles. Like Summers, Goolsbee believes in a kind of “Psychological Tendencies Economic Model” touting that it is perception that steers the worlds economic markets not necessarily fact. Having fought the gold manipulation battles for so long we all know perception can be managed and manipulated as I discussed in my articles “Operation Confidence Con” and “Geithner Plan=Sustained Manipulation”.
On May 28th, the night before the White House taping, Jim Willie of Goldenjackass.com posted an article called “The Hitman Cometh” where he claimed the Germans are trying to withdraw all their physical gold from US control and several “hit men” have been hired to take down the COMEX and the LME:
“The Germans have demanded that gold bullion held in US custodial accounts be returned to their owners, with physical gold shipped back to Germany .”
I’ll bet my last gold Kruggie that the Oval Office phone call was a desperate plea to buy more time before the Germans destroy the physical gold manipulation scheme.
This together with rumblings of China, Russia, Saudi Arabia and Dubai scrambling to get their hands on physical gold has put the Obama Manipulation Team in major gold panic mode.
It’s amazing to see these few people in the White House scrambling to prolong a failed policy of trying to manipulate the gold markets of the world.
What a sad state we find ourselves in.”
@Jeff S. I agree with your assessment of JIM WILLIE. Not only are GERMANY and DUBAI asking for the GOLD, but there are SUPPOSED COMEX and LBMA HITMAN who are going to TAKE DOWN THE COMMERCIAL SHORTS.
Furthermore, BIX WEIR wrote an article called, “Gold Panic Inside The Oval Office”, where LARRY SUMMERS an GOOLSBEE come into the OVAL OFFICE about an IMPORTANT PHONE CALL FROM GERMANY. At that time, BRAIN WILLIAMS from NBC was filming a LIVE DAY WITH OBAMA. Looks this was about the GERMAN GOLD. Here is the DIALOGUE:
Summers: “Life has changed..ahh..since the briefing…ahh”
Obama: “For the better or for the worse?”
Goolsbee: “Net-net for the better…wouldn’t you say Larry?” (Goolsbee speaks loudly and unconvincingly for the cameras.)
Summers: “(nervous laugh)..there’s elements of both. The Germans…actually we should stop (the cameras) here.”
You can go and watch the ACTUAL FOOTAGE of SUMMERS putting his hand up in front of the CAMERA and telling NBC that is was time to STOP THE CAMERAS. Go to 7:15 into the FIRST PART and you will see what took place.
LINK TO NBC LIVE COVERAGE:
http://www.msnbc.msn.com/id/30892505/#31073805
LINK TO PANIC IN OVAL OFFICE ARTICLE:
http://news.goldseek.com/GoldSeek/1244050251.php
@SRSrocco
I actually tried to post the same “Gold Panic Inside the Oval Office” link
I have also been a bit skeptical of Jim Willie, but he makes no bones about this one: he says he has solid sources. But, of course, discusssion of COMEX on this board is wasted. Tom does not believe in manipulation of any kind. Larry Summers is a straight up guy! Yeah.
Thanks for the links. I bet we are about the only people in the country who have some sort of idea of what might have gone down at that moment.
@SRSrocco
I was actually trying to post the same link to the “Panic in the Oval Office” article
Like I said, it is game over for US Empire. Tom, I see early 2010 as follows:
The end of the 1st quarter + 30 days which equates to 4-30-10. I will not bet something physical but I will bet a mental proposition. I will admit to all that I am totally clueless as to my short term prediction of 55% unemployment and the end of US empire if you will end this blog if I am right.
After all, if this plays out like I see it you will have no credibility left and you will be just trying to survive.
I love the devolution from market talk to doomsday
although I understand its value in investment strategy
better start making very specific definitions for your bets,
cause I’m always looking for a angle to leverage.
sure people may not be driving in a pressed suit to sit at a desk
& u might not have pretty girls scooping ice cream
as long as there is fuel, operating at a loss is better than not at all.
similar situation with vacancies, rather than destructive squatters,
they’ll let people work in exchange for housing.
employment redefined as = security & maintenance in exchange for housing.
jackbooted thugs get legit credentials
“A job for two, who are now of job age, the police” -Clockwork Orange
self directed foragers will be workin up a sweat!
go pick berries & catch a rabbit, then try to say that u didnt ‘work’
& those that dont wanna work … I’d call that culling the herd.
after a month of not working, Mortimer would be fully employed.
“bring out your dead” = 100% employment. Deadwood style
I just had a brainwave. Next time Barry comes to Canada, Prime Minister Harper should present him with a 1971 Lincoln Continental Mark III, you remember, the one with full leather interior and real wood dash trim. It was the GOLDEN Anniversary for the Lincoln marque. Tinted glass was standard. It won Motor Trend’s “King of the Hill” by a wide margin over the Eldorado. Wait a minute–Obama’s running GM.
Never mind.
Good old Jim Willie and his gold explosions!
No actually, I read his stuff too.
@Jeff S.
Jeff,
It’s good that you have been skeptical of Jim Willie. It is highly unlikely (close to impossible) for the COMEX to default in June. Simply there are too little June contracts open for delivery to empty Comex vaults.
The deliveries have been only 300k ounces:
http://www.cmegroup.com/trading/energy-metals/files/delivery.pdf
There are 3454 contracts open as of yesterday (See page 3 of the report):
http://www.cmegroup.com/trading/energy-metals/files/cmxopint060309.pdf
which means that only ~650k ounces will be delivered in June. This means that June is in fact a pretty weak month - last October and December were well over one million ounces.
As COMEX has over two million ounces in registered inventory, it has more than sufficient amount of gold to cover the deliveries.
Maciek.
Gold and the Euro down against the USD, while US Treasury yields up across the curve? including the 3 month T bill, which I think until now has been looking very bullish.
Interesting. Is the move down Exter’s pyramid gaining momentum? Will Jim Willie have his explosion?
Well I must say things are setting up nicely for a good trade in shorting gold and silver. Actually it was last thursday when the price spiked up to $980 on gold and $16 almost on silver, was probably the point to put the trade on. Simply put the manipulative government allowed suppression on the comex, by the shorts. Is getting so out of whack, the only direction is down it appears. So why fight the crooks, go along and play the gold and silver ponzi game and make some money.
The 60 minute Silver and Gold charts have a bullish MACD divergence crossover and the USD is currently down against the Euro, CAD and AUD.
Tomorrow tells the tale.
Well that’s quite an uneven bet don’t you think? How many readers do you have exactly? That said, I’ll take the bet with the following modification. If I lose, I will do as you say and close this blog. If you lose, you will write a guest essay for publication on this website in which you warn people about extreme positions and the pundits who sensationalize and scaremonger, you identify such pundits by name and chastise them, and you admit that my level-headed and balanced approach to the monetary metals is superior to their punditry.
Let’s see what kind of stand silver makes at $15 and gold at $950 when London opens in about an hour. If not a good one, the rest of Monday could be ugly.
Looks like our friends gold and silver did not handle $15 and $950 well. Could be a tough day.
I will be slowly re-aquiring speculative positions as this bout of weakness unfolds. Aussie dollar gold is off 20% from late Feb, however it is at a crossroad of sorts. Aussie dollar gold has fallen from AU$1550 and has been skidding along within 10% of AU$1200 since the beginning of April. The 50 DMA is falling and is about to touch the rising 200 DMA. Slowly does it through this period while the trend of the next month or two unfolds. A convincing break of US$1030 and I will be all in. I expect it before the end of this year, however probabilities favour a dip first.
Tom,
I accept and I want you to know I mean no dis-respect to you or anybody here. In fact, I agree with a lot of what I read here.
I just happen to believe this cycle is over and we are headed into something completely different and this old slave-state-paradigm must pass/die out. It will be a very difficult transition but once we get to the other side life quality will be much improved mainly due to the fact the money-changers will be routed out. I only hope people will prepare for this.
@Joe M.
Deal.
Ag remains above 14.90 and Au around 950 $. There are rumors on several internet sites that an interest group launches a try to counter the actions of the big shorts. Let’s see how this develops. It may be a mistake to sell the physical stuff under this circumstances. Paper-oriented strategies should be open to all possibilities.
@DiscreetSilverBug
Even if true, such an “interest group” stands a big chance of failing spectacularly and thus taking down the price of silver and gold without any help from the “banksters” themselves.
@silverax
@silverax
that’s a terrible bet for everybody. nobody wins. we need counter balanced opinions right or wrong and in this case I think you’re both partially correct.
@rob
Don’t worry, I won’t lose and the “guest essay” by Joe M. will not be a
“hit piece”.