XAU/USD & XAG/USD - Gold & Silver Traders Thread

I ve noticed that sometimes after a big fall there is a follow on fall almost the same size or slightly smaller, But looks like Gold is stabilizing around the 1236/40 area...

Could we have another fall ???

I am still waiting on the sidelines

The reason I am such a fan of gold is the value of gold is going up.

We are trading the price of gold in dollars.

If you look at the monthly chart for gold the trend is parabolic. It is a curved trend. It is going up faster and faster. You might think this is a bubble that is going to burst. I don't believe so at its present ascent.

The reason the trend is parabolic is:

1 Gold is priced in dollars.
The dollar is worth less and less, year on year. All the fiat currencies are worth less and less because the central banks are creating more and more of their currencies to fund the escalating debt. This has not as yet caused inflation. This is because interest rates are very low. It will come. When more and more currency is pushed into a system, inflation must follow. When there are more of a currency in a system, with nothing to back it with, it has less and less value and so you need more and more of the currency to buy goods with. This is inflation.

2 Gold is more valuable.

Even if there were no inflation, the price of goods go up and down. This is based on supply and demand. If something is in demand and there is a shortage of supply, the price will go up. The reverse applies when the price goes down.
The commodity's price fluctuates based on how valuable people see it being.

The price of gold has been kept down by central banks pushing gold into the system. But their reserves of gold are diminishing.
As confidence falls in the paper currency system, when the dollars in your bank account become worth less and less, people will look for something better. Traditionally this has been gold.

3 Because governments have lost control over their spending, debt has become unmanageable. The US debt is like a massive weight on the country and it is getting heavier and heavier. When there are doubts are to whether governments are going to get new bonds away, things are getting bad. Fiat currencies (http://en.wikipedia.org/wiki/Fiat_money) are ultimately doomed.

When it all comes down - may be next year, may be in 5 years - but when it all comes down, what is the solution? It might be gold, it might be silver, it might have to be land. But currencies will have to be backed with something tangible and not debt ridden promises. Gold will play its part, it always has. There is something in our psyches about gold - in ancient times, in modern times. It will play a big part.

4 There is a special case for silver. All the other factors apply and then consider silver is needed in so many processes. It is running out so quickly. More, much more needs to be mined but at the moment it is not economical to mine silver. The silver we get is a by product of other mining. But this doesn't put enough into the system to match the needs so it must become economical to mine. So the price WILL go up and it will have to go up very significantly.

So there is a very strong case for the trend to continue in gold and silver.

A trend is like compound interest.
There is nothing more powerful in the universe than compound interest.

I spread bet in £ pounds. If I bet £5 a pip on gold going up.
I have my trailing stop. The trend is up, so when I get taken out I wait for the trend to come back and jump back in. I know the trend will always come back.
Currencies go up and down. Gold and silver - especially silver are going up.
They might find some massive massive new mine for both, but until they do, they are going up.

As the money I make climbs, I can then bet £6 a pip. But gold is going up more per week (the rise is parabolic) than it was when I was betting £5 per pip. After a while I can bet £10 a pip and at the same time gold is going up even faster than before. The dollars it is priced in are worth less and less, gold is in more and more demand.
The amount I make grows faster and faster.

I don't know what the sums are but imagine you followed this method starting in 2001. You would be protected in the big pull backs by your trailing stop. You could have waited for gold to recommence the up trend. You will have lost nothing. Now you would be looking at massive profits.

Now you need to back test. You need to decide the size of the trailing stop and you need to decide how much you can start off with. This is the most dangerous time. You don't want to get a margin call. Once your bank builds up, unless you get stupid (too greedy) you are unstoppable.

Discuss further.
The big problems to trend traders is spotting when the trend is changing.
If the trend isn't changing it is a licence to print money. I don't like that analogy because this is the reason there is so much trouble now but it is true.

Great Post Six,

Ok so lets have a look at 10 year Gold.

http://www.kitco.com/LFgif/au00-pres.gif

The year 2000

we are able to buy Gold at 300 appx at best say 250 per ozt.

5 years later - we have doubled our price at appx 500

2005 it all starts over and the rise is compounding.
another 5 years later the 300$ Gold is now 4 + times in value
and 500$ Gold is almost 3 times at 1240 -

Technically speaking without suppression Gold should be at about 1500 per ozt.

Even a 200+ correction only brings us to the range around 980 or 1050 supports but does not break the long term trend.

Good I'm glad you didn't take a hit.

Tonight I am going to only take trades based on reading news and charting.

Once the trade is placed I am walking away.

Too many recent trades of mine have been set up perfectly, then too much meddling is causing me distraction and premature exit on both profitable trades.
likewise exit on trades not yet in profit due to the market spiking.

There are Pro FX traders that are even saying they have Never seen anything like they do today in terms of volatility and swings in FX.

Things are crazy!

Lets do some live trading in here tonight, are you guys around?

Say meet up when Asia opens.???
Or later?

I'm long from 1232.83, just got back to my computer, I would have figured with the Dow tanking gold would have at least re-traced back too 1250?, In reading previous post I couldn't agree more on countless occasions I set a moderate trailing stop and walk away then it hit the stop and goes in the opposite direction. Also in my reading can someone fill me in a little more on the JP Morgan and silver relationship?

I cannot see such a correction.

The trend is not linear it is parabolic.

Go to the monthly chart for gold.
Zoom out so you can see at least from 2000 to the present day.

See price progression is up [the trend is up, the trend is up] and it is getting faster and faster up.

Now zoom in - look at the candles in 2000 - pan across. The candles get bigger and bigger - the trend is going berserk. It is vertical.
The ground covered in a year in 2000 is covered in a month or less.

This is what you see in parabolic curves.

On Friday last the right shoulder of the head and shoulders on the Dow was well under way.
Yesterday a big bearish pin bar came off 10600.
Today the Dow dived. (I think it is dove in US).

The right shoulder is going to form and the Dow is going to crash.
It is like the prelude to the Great Depression.
Go look at the charts. Compare.
High unemployment. Credit crisis US - Credit crisis Europe.
The charts look the same and the circumstances are very similar.

I just looked this one up. It is a bit Mickey Mouse but it gives the message.
http://www.gold-eagle.com/editorials/great_crash.html

Perfect example. I closed my longs from 1233 for minimal profit.
The intention was to leave them open. We did however dip back to my entry so...

The positive thing is that I think we have established a decent support here for the time being and we should see a rise in the upcoming sessions.

JPM is one of if not the biggest commercial shorts on Comex Silver

They also use their muscle (or cash) to place huge orders during London / NY to suppress the price further. They can easily move the market.

I'll find some articles about the investigation in a bit.

Gold went down because traders want to lock in profits. All time high.
As I said earlier, prices do not move in straight lines. They may more down when at the current price they are good value. But if they are value they will end up moving higher in an upward trend.
Price had moved well away from my most recent trendline. I have had to draw three since 2005 as the trend is not linear it is parabolic.

I am in Spain right now which is GMT+2.
This is too late for me.

I would be interested discussing strategies.
If people want to trade live - fantastic - go for it.

But I would be interested in being in long term longs with stops trailing.
The stop needs to account for volatility and daily range.
I would love to be in a long that is making say a rising stream of profits as gold progresses higher.
It is spotting good entry points for investments and setting the trailing stops correctly.

Doesn't it seem that using some technical analysis that works with currencies pairs and equity may not be as efficient with gold. People try to correlate it with X,Y,Z meanwhile people are buying it for such a large number of reasons namely black swan situations etc... eg; the yaun, the coming bank stress test in Europe etc.. (which will be a joke I'm sure)

I am def up for some live trading

Nor Can I, just in case, it is nice to know that such a correction only pulls us to to the mother trendline!

I am setting sights for 1300.

QUOTE=six gun;3821698]I cannot see such a correction.

The trend is not linear it is parabolic.
[/quote]

You are correct, they sometimes do not.

Trendlines can be broken via simple market change.

There are reasons why technical analysis has not worked properly on silver because market forces have not been normal.

Most markets can be technically analysed, but most of the analysis done is shit. There are too many crappy indicators, oscillators and dumb chart patterns. They are all BS and do not work in the long term.

TBH with gold it is spotting as low as you can find and then jumping on the escalator.

Technical analysis has nothing to do with motives. Whether people buy gold to put in a Bank of China vault and deny they have it, or to make a wedding ring or frank coins. It is all supply and demand. This is what technical analysis is about.

I am happy to give chart comment as it arises.

There are lots of videos on youtube - search silver manipulation.
I have the interview with Andrew Maguire where he reveals the silver manipulation by JP Morgan -

http://www.kingworldnews.com/kingwor..._Douglass.html

http://www.kingworldnews.com/kingwor...w_Maguire.html

THe market re -opens in
12 minutes.

tick tock.

Thanks for all the info...you guys are great!.... I do have one more ?, Has anyone looked into the buying and selling habits off these gold and silver etf's? I would imagine their growing like crazy but how do they track the market ex; do they buy and or sell in morning or before market close etc... I have read that some indices tracking etf, can throw the market toward the end of the day?

Yes, about the analysis, it can be hit or miss.

In volatile gold markets you are better off study the price action and the reason why or the fundamentals then relying on techs.

Short article.
http://www.businessinsider.com/jpmor...igation-2010-5

There is a video on utube I believe about a trader talking specifically about how they manipulated silver and would laugh about it after in JPM london

LOL as i read back Six beat me to it ! I think that is the one

With my broker I can trade spot and futures. I have not looked at Exchange Traded Funds so I can't answer your question.
May be XTrade knows something.
I do have some EFT's available to me so it might be worth researching.

I am big on technical analysis so I think you can predict some of the moves.
We are using some of this analysis.
We are using trendlines, the 356 ema is support at times, price action is part of technical analysis and the main part for me.
There are the rising triangles and the support/resistance lines.

On the 4H chart I can see some nice bullish pin bars around 3rd June with wicks coming off 1200.
Before the last push up to record highs there were a series of inside bars which broke higher.
Gold is trending up so hard it is hardly worth too much analysis and indeed a lot of analysis is made redundant by this trend.
The trend is up is most of what you need to know.
Do not be too greedy and trade with the trend.

ETFs Like SPDR GLD
Track gold by offering a share that is supposed to be relative to 1/10th of an oz of gold.

So to buy 1 oz you need to buy 10 shares GLD. However, they are not as accurate as spot. THe ETF is supposed to own and buy and sell gold in and out of the spot market to meet the fluctuating price of spot as well as maintain a backing for the shares.

There is suspicion by some on how much gold GLD actually does own.


Take a look