Where Is Gold Going In This Market

[sallydavidson]

what do you mean by "was"? i posted some facts. among these facts was a chart. you presented three or four different insinuations which were all not only irrelevant but plain false and insulting. shall i go back to what was written, copy/paste and rip your comments in tiny small pieces to shame and ridicule you?

that you lost the immense fortune of 14k must have been a horrible experience. but i am sure it was not because somebody mentioned some success in past tense!

Such abusive comments are unbecoming a person of your implied stature.

"shall i go back to what was written, copy/paste and rip your comments in tiny small pieces to shame and ridicule you?"

please do.

"that you lost the immense fortune of 14k "

Yes, I cannot afford to lose that much. Even at my best on a regular office 9-5 job I've never made more than 80k per year, ever. 14k is alot to me, that's why I live in Thailand. I can afford it easily.

[Naam]

Sally,

i already apologised for addressing the wrong person. you were not meant in my rebuttal. i was even mistaken as far as the 14k loss is concerned. please accept my apology.

i humbly apologise for addressing again the wrong person (CMSally). reason: i don't devote enough time to Thaivisa as i am busy making a buck or two every day during these interesting times. after all... my dogs are insisting on three meals a day and i promised Mrs Naam i'll do my level best that she can give up that third job (cleaning the homes of two of our neighbours).

jap.gif

This post has been edited by Naam: Yesterday, 2009-08-19 18:44:26

Edited August 20, 2009 by Naam

[sallydavidson]

Sally,

i already apologised for addressing the wrong person. you were not meant in my rebuttal. i was even mistaken as far as the 14k loss is concerned. please accept my apology.

i humbly apologise for addressing again the wrong person (CMSally). reason: i don't devote enough time to Thaivisa as i am busy making a buck or two every day during these interesting times. after all... my dogs are insisting on three meals a day and i promised Mrs Naam i'll do my level best that she can give up that third job (cleaning the homes of two of our neighbours).

jap.gif

This post has been edited by Naam: Yesterday, 2009-08-19 18:44:26

Hi Naam,

I am not CMSally, I'm Sally Davidson. So your posts were directed correctly to begin with. If you should apologise to anybody, it should be to me, Sally Davidson.

But I don't expect miracles from you, Naam - I've done my homework and read many of your posts.

If you're in the apology giving mood, why not hand one out to britmaveric too? I've read his posts too. You didn't do him right.

Britmaveric: 12-23-04 ..... Highly unlikely - watch for a steep rise in $.

Britmaveric: 8-17-09 .... $ is strong and will continue to dominate the world currency markets. Look for 40-45 per baht soon

Naam: yawwwnnnn... i am reading this kind of bull from you over and over and over since several years Brit

The first britmaveric call was tail-end of December 2004. It was an excellent call. And there were similar followups around that period by him. A trader never forgets a good call.

The 8-17-09 recent call by maveric is a call that is in progress, its outcome yet to be determined.

There were other good calls by maveric and what I noticed is that he never ever bashed anybody that called against him. But you, you nail anybody even unprovoked.

If you had done what you did to maveric after that 2004 call on any other trading board in the universe you'd be in the doghouse permanently.

That you have chosen to be forum guru is undeniable.

But a big no no is you've made no calls.

Then I see stuff like this ....

August 9, 2009

Teletiger: The Baltic dry index is on it's way down again? -17.2% last week. 35% down on 2009 highs.

Naam: the BDI without any details might present a wrong picture. important is the ratio of cheap commodities (e.g. scrap metal) compared to high value products (which are shipped in containers). as the index contains both (and a lot more) categories a drop of e.g. 15% of iron ore, coal or fertiliser might be offset by an increase of merely 1% of valuable high-tech products.

You'd be laughed out the room at almost any trading board. Stuff like that is what Enron analysts were saying giving stong buys all the way down to zero.

best regards

Sally

[sokal]

http://www.telegraph.co.uk/finance/persona...ales-slide.html

Start with the title

World gold demand fell 9pc in the second quarter to 719.5 tonnes as rising prices and the impact of the global recession curbed jewellery consumption, the World Gold Council said on Wednesday.

and end with the last sentence

Overall world gold supply was up 14pc year-on-year to 927 tonnes from 812 tonnes, the WGC said.

I work that out to be a 29% oversupply.

Price must go down.

Or maybe somebody can point out the fault in my argument and/or the figures supplied by the World Gold Council?

Why did Cash4Gold superbowl commercial pay big bucks for a superbowl commercial last year ? Somebody wants your gold now.

Edited August 20, 2009 by sokal

[AlexLah]

I downed the 1 yTD USD Index chart and flipped it and added 1 year Gold price graph. Gold did not change shape weight or color I believe.......

Hows about that?

[Abrak]

Bloody hel_l Alex,

Not only do I have the dollar index in red and black, I am not even convinced the dates match up. Then I have MVAs which I dont know what to do with. 1 year gold is an odd concept unless it is showing the price of gold over one year. And then there are indicies all over the place.

I do agree there is a 'neat' correlation there, I just have no idea what it is.

I would guess it is something like when the dollar goes down the price of gold goes up but that 'guess' is based mainly on the fact that it is the most natural correlation. Can you help out a bit?

[AlexLah]

I just took the one year correlation between USD and Gold as an example Abrak. I know you are very good in finding charts so maybe you could do the same for the 10 year correlation as I don't know where to find. Fact seems to be that Gold has reacted on Dollar index at least this last year.

If you can post the 10 year or longer charts of USD index and Gold price and compare, we could see something.

Maybe there is a point in time that Gold value followed USD index and I am very interested when that happened in order to find out what has happened.

Sorry for my bad English.

[lannarebirth]

I just took the one year correlation between USD and Gold as an example Abrak. I know you are very good in finding charts so maybe you could do the same for the 10 year correlation as I don't know where to find. Fact seems to be that Gold has reacted on Dollar index at least this last year.

If you can post the 10 year or longer charts of USD index and Gold price and compare, we could see something.

Maybe there is a point in time that Gold value followed USD index and I am very interested when that happened in order to find out what has happened.

Sorry for my bad English.

You can't find a much better reverse correlation than this IMO:

USD vs EUR

There's your 10 year $USD vs $GOLD

Edited August 20, 2009 by lannarebirth

[AlexLah]

A better graph you can see here: http://www.ecb.int/stats/exchange/eurofxre...aph-usd.en.html

[Abrak]

Ok here is my guess answer assuming that your chart shows an inverse correlation between the gold and dollar.

This inverse correlation is what you would expect under normal circumstances - one is a hedge against the other.

However if you look at a 10 year chart you will see that while the dollar has fallen a third gold has risen 3x, so only one third of golds appreciation can be explained by the dollars fall. The easy way to explain the other side of the asset appreciation of gold is to put it down to loose monetary policy (excessive money supply growth) but this argument is circular because it is also the reason for dollar depreciation.

To me (and I will readily admit I have very little knowledge of golds fundamentals) there were two others factors at play. By picking golds low as your starting point, however you value gold, you are probably picking a price of undervaluation, more importantly the excess monetary growth in the US was not unique, there was competitive devaluation so that loose US monetary policy did not result in as much a fall in its value as you might expect.

And I guess this is the gold bugs point. Gold should always be a natural hedge against the perceived value of a currency as your chart shows. By nature it should also outperform fiat currencies in general.

[Abrak]

Lanna,

While your chart is exceedingly pretty and demonstrates your point about the inverse correlation of gold and the dollar in a perfect way. I do hope you realize that this has been achieved by a careful choice of indicies on the two Y axis.

I have no objection to this - graphs should look as pretty as possible.

[lannarebirth]

Lanna,

While your chart is exceedingly pretty and demonstrates your point about the inverse correlation of gold and the dollar in a perfect way. I do hope you realize that this has been achieved by a careful choice of indicies on the two Y axis.

I have no objection to this - graphs should look as pretty as possible.

Yes, I know it's not scaled properly. Still, you can judge relative price movement.

Like here:

The other thing Abrak is that Time is as important to me as price so its useful in that regard.

There, that's better:

Edited August 20, 2009 by lannarebirth

[Abrak]

Lanna,

No criticism meant, great chart, I just thought a word of caution should be added.

BTW as far as I can read one of your latest charts, it would imply there is a close correlation between the Chinese stockmarket and the baltic dry index. This would seem highly unlikely. So I am either reading it wrong (very likely) or you made it up (for fun).

P.S. I 100% agree that time is as important if not more important than price when it comes to correlation.

Edited August 20, 2009 by Abrak

[Naam]

Hi Naam, I am not CMSally, I'm Sally Davidson.

duly noted. but don't expect that i waste time and comment on the rest of your posting

[Carmine6]

This is fantastic! Now if someone can just post the accurate forecast for the price of gold or the dollar index for the next several years, we can all be billionaires.

[flying]

woeful performance from Gold over the last few days... again

What happened did you buy on the 13th?

I had mentioned a week or so ago of the pullback that was expected.

Watch after August 22nd for the continue of the performance

Hmmm its rise early?

Well I am surprised if 935 was the extent of the pull back

Not that Im complaining

We will see what next week brings

[sokal]

woeful performance from Gold over the last few days... again

What happened did you buy on the 13th?

I had mentioned a week or so ago of the pullback that was expected.

Watch after August 22nd for the continue of the performance

Hmmm its rise early?

Well I am surprised if 935 was the extent of the pull back

Not that Im complaining

We will see what next week brings

These are the dog days of summer for gold too. Watching gold daily is kind of a waste of time. The reason to buy gold is to store purchasing power over the medium to long term as the dollar gets devalued.

[Abrak]

These are the dog days of summer for gold too. Watching gold daily is kind of a waste of time. The reason to buy gold is to store purchasing power over the medium to long term as the dollar gets devalued.

Sokal,

I think about this argument a lot. I agree with it entirely. It would be highly surprising and I believe you could consider yourself unlucky if gold didnt outperform the dollar on a 10 year view.

It just seems slightly lazy as an investment argument. Dont you think that most assets will outperform the dollar? Dont get me wrong. It is obviously wise to be in an asset that holds its purchasing power than one that is going to be devalued.

Somehow to me though this argument amounts to I am shagging this girl because the girl over there is a dog.

[Naam]

I am shagging this girl because the girl over there is a dog.

[Abrak]

I am shagging this girl because the girl over there is a dog.

Please dont get offended by the term 'dog' it was only meant as a figure of speech.

I realize that in the past that say 'sally' has accused you of being an all knowing forum guru while you may have inadvertently claimed that your dogs have special predictive powers. Obviously they have to be fed daily so they may quite possibly claim all sorts of things.

My comments were not meant as an insult at dogs in general. While they might understand matters better than me I dont think anyone should assume the bar is set too high.

[Naam]

I am shagging this girl because the girl over there is a dog.

Please dont get offended by the term 'dog' it was only meant as a figure of speech.

i am not offended at all Abrak. in fact i claim that some females do indeed deserve to be called "dogs"

[Naam]

Hi Naam, I am not CMSally, I'm Sally Davidson.

duly noted. but don't expect that i waste time and comment on the rest of your posting

sallydavidson

Newbie

Joined: 2009-08-19

hmmm... we Romans call that "alter ego"

[flying]

hmmm... we Romans call that "alter ego"

Huh? I thought we called that harmonica?

[sokal]

These are the dog days of summer for gold too. Watching gold daily is kind of a waste of time. The reason to buy gold is to store purchasing power over the medium to long term as the dollar gets devalued.

Sokal,

I think about this argument a lot. I agree with it entirely. It would be highly surprising and I believe you could consider yourself unlucky if gold didnt outperform the dollar on a 10 year view.

It just seems slightly lazy as an investment argument. Dont you think that most assets will outperform the dollar? Dont get me wrong. It is obviously wise to be in an asset that holds its purchasing power than one that is going to be devalued.

Somehow to me though this argument amounts to I am shagging this girl because the girl over there is a dog.

Yes but think of all the idiots that pile into treasurys and paper, talk about a lame as$ dog of an investment. 3% yield on a 30 year bond, no inflation pretection, that's a dog.

[Abrak]

Yes but think of all the idiots that pile into treasurys and paper, talk about a lame as$ dog of an investment. 3% yield on a 30 year bond, no inflation pretection, that's a dog.

Yeah dont I know it. I actually think bonds might be the best short term investment. But you would literally commit suicide if you thought that investing in something that yielded 3% was going to make you money.

So to me it just isnt easy - mostly I am buying bombed out stuff on a 5-10 year view. I cant see short term gains. I am sure they are there but they arent obvious to me.

[flying]

http://www.safehaven.com/article-14276.htm

For the tech types

[lannarebirth]

http://www.safehaven.com/article-14276.htm

For the tech types

I'm not saying the author is drawing the wrong conclusion but I would make a couple of points. He starts with a technical premise and justifies it with a fundamental argument. That is inconsistant methodology in my view and smells of heavy bias. Again, I'm not saying he may not be correct in the end.

The other thing that strikes me is that $GOLD:$XEU chart. It's a parabolic breakout chart. It may have another leg up in its parabolic move but rest assured it will retrace 100% to 2004 levels at some point. Whether Gold or the Euro is the winner there I can't say, but I have a hunch.

[Naam]

http://www.safehaven.com/article-14276.htm

For the tech types

I'm not saying the author is drawing the wrong conclusion but I would make a couple of points. He starts with a technical premise and justifies it with a fundamental argument. That is inconsistant methodology in my view and smells of heavy bias. Again, I'm not saying he may not be correct in the end.

The other thing that strikes me is that $GOLD:$XEU chart. It's a parabolic breakout chart. It may have another leg up in its parabolic move but rest assured it will retrace 100% to 2004 levels at some point. Whether Gold or the Euro is the winner there I can't say, but I have a hunch.

tell us... or else!

[Naam]

Yes but think of all the idiots that pile into treasurys and paper, talk about a lame as$ dog of an investment. 3% yield on a 30 year bond, no inflation pretection, that's a dog.

there will always be idiots. some idiots bought gold at 850 in january 1980, some idiots bought Palladium in december 2000 at 1,100, some idiots bought Enron shares in 2001, and some idiots bought Lehman bonds in 2007.

but this is all hindsight. some (who were once called idiots) bought quite often (what others considered) crap and these idiots live happily ever after.

[lannarebirth]

http://www.safehaven.com/article-14276.htm

For the tech types

I'm not saying the author is drawing the wrong conclusion but I would make a couple of points. He starts with a technical premise and justifies it with a fundamental argument. That is inconsistant methodology in my view and smells of heavy bias. Again, I'm not saying he may not be correct in the end.

The other thing that strikes me is that $GOLD:$XEU chart. It's a parabolic breakout chart. It may have another leg up in its parabolic move but rest assured it will retrace 100% to 2004 levels at some point. Whether Gold or the Euro is the winner there I can't say, but I have a hunch.

tell us... or else!

Like every other market it all depends on what the $USD does. My theory based on a methodology I don't fully understand (Hurst Cycles) has the $USD bottoming near late September. The fact that the Euro and Gold look like they want to move sooner aggravates me and my perhaps bogus theory. 5 weeks is a long time if $ selling gets started in earnest, at this time I'm still execting last years low to hold but honestly that's just wishful thinking.

If all that sounds confusing it's because it is confusing and I don't have much confidence in any of it. That's why I haven't presented a view before now. Maybe things will look clearer in a few weeks, but I'm not too confidant of that either.

Edited August 24, 2009 by lannarebirth