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

Can I understand the situation better... If the US falls over the fiscal cliff possibly leading to a recession or if Democrats/Republicans compromise on a lousy deal, price of metals go up because people dont know where to park their wealth under uncertainty?

It's nice to see so many charts being posted.

As to the question of whether or not gold and silver will drop further and when this correction will end, I ask what has changed in the markets to trigger the reversal?

Usually, when any vehicle reaches its optimal target level, be it a currency, stock, or commodity, the price changes direction swiftly and obviously. That didn't happen, so either this isn't the bottom or price isn't the trigger we're waiting for.

Tax selling is over, Dec 12 futures have expired, Dec 13 futures are available, yet the metals aren't going up, so that wasn't it either.

The new Japanese government proposed massive easing, and with the second largest bond market in the world that should have, but didn't, start gold climbing.

It's been both suggested and recommended that BRIC and developing nations are and should increase their gold supply by an amount that would take over a decade to achieve at current production levels but still gold moves sideways.

The so-called "fiscal cliff" is the focus of the media, so perhaps we're waiting for that to be "resolved", but the only possible outcomes are generally considered to be bad and worse, both of which should see the value of metals as a safe haven increase, but in that case, if the outcome can only send gold up then buying should have already commenced, but it hasn't.

Looking at these events that could have triggered gold to go up but it didn't, I'm left with the bias that the metals must either fall further or at least spike down, and so I'm willing to miss out on getting in on the bottom and wait for confirmation of the reversal before buying. (Long-term buy-and-hold positions notwithstanding.) If I'm wrong, I may lose an opportunity to profit, but I won't lose any money either which is more important.

As always, I try not to marry myself to any position as smart investing requires an open mind, so I'm ready to go long as soon as that becomes the "obvious" play, but for the time being I'm still looking for short-scalping opportunities.

KADC - Thats a very good analysis.

Short term if fall over fiscal cliff completed USG debt growth will slow down by about 50% -perhaps H1 2012, and the future debt scenarios become uncertain as long as debt ceiling debate not resolved.

Hence either sideways or down, until then. if fall over fiscal cliff completed and not resolved immediately afterwards, debt ceiling may not be actual for another 6 months. So than any move up in metals may happen only June-Aug 2013.

From ZH:

http://www.zerohedge.com/sites/defau...1230_QA3_0.jpg

But of course USG will resume debt generation at even higher speeds after that. Until then- very volatile PM prices as all will be depending on politics almost every day. As it does now before fiscal cliff.

then what you suggest at which range we should enter in long position and what should be the short position

Regards

GC Daily:

http://www.screencast.com/t/PhjnlD0yIb

Red Fork is showing downtrending support and especially resistance.

Green fork is mod schiff from 2008 lows and has the same angle as the blue fork. Blue fork has A at the last low before approach to All Time High - and has circled tail action. (Have removed blue LP as it coincides exactly with green LP and gives both a weird colour)

Happy New Year - wishing everyone health and happiness....

beeb

Ivars - fyi what you have posted is a series of action/reaction lines NOT a pitchfork - effective but lacking the inherent strength of pattern of a fork. Pitchforks need to go low-high-low or high-low-high.....You seem to have drawn high-high-low.

Further info at www.coghlancapital.com

beeb

Very clear forks, and happy New Year to you as well.

The parallels I use have the centreline of your red fork going back to the Sep. 2011 high which seem to line up a little better but I'm using NetDania charts which have questionable accuracy across time scales so it's possible the lines are being "autofudged".

Bearing in mind that you should always rely on your own charts, I'm using the same general range as before though perhaps raising it a dollar on each end would be appropriate since we seem to be drifting higher in parallel to the blue/green forks on the charts beeb just posted.

XAU/USD is above 1671 as I type this now.

The move up coincided with the AP announcement that they are close to a deal and Obama is set to speak at 1:30pm so I presume a deal has indeed been struck. We'll find out if this is what the metals have been waiting for in 20 minutes.

Update: It appears he just wanted to chat. How nice. Gold and silver are just hovering where they rose to but on a break above or below the range they've sat in for the last hour I'll take a small position in the direction of the break.

Do you think it could be a false break?

Looks gold is a good deal now. If news from Obama good - gold will plumet. If not - sideways. But now gold sits on MN resistance, so good position to make trades with r/r.

Happy New Year all!
May this be a healthy and prosperous one!

XT-

Maybe. Maybe not.

It rose to the 38.2% Fibonacci (from the $1755 leg down) which is frequently followed by a continuation of the current trend (down in this case) or at least a retest of the low. Also, though gold rose, it stopped rather than gaining the momentum typical at the end of a correction.

On the other hand, gold did trade sideways for several months last spring at the end of its correction before climbing, but that was inline with the historic seasonal pattern and it would be very unusual for gold not to climb swiftly in January.

The relative lack of volume indicates that neither the central banks nor cartels are exerting any market influence in either direction, but since I have no idea what they're waiting for I'm not willing to make a bet one way or the other.

I'd be far more comfortable going long after another push down than I am going long after a fizzled out push up, but we'll just have to see which way the price breaks from this point and go long or short after we get confirmation of direction.

Nice to see we ended the year with a punch from the bulls!

A longer view look:
Gold is on a 12-year hot streak
In the article picture - just one of those bars is a yearly salary for some!
From businessinsider.com
"Gold prices edged higher Monday after President Obama said that a budget deal to avoid the "fiscal cliff" was in sight, if not yet complete. The advance capped a 12th consecutive year of gains. February gold rose $19.90, or 1.2 percent, to $1,675.80 an ounce. Gold gained almost 7 percent in 2012 after starting the year at $1,566.80. Investors have been buying gold as a safe haven and as protection against inflation while the value of the dollar declined. The metal has gained almost six-fold since the start of 2000. In other metals trading, copper advanced 6.3 cents, or 1.8 percent, to $3.6525 "

Hey, I take it English is not your first language which is totally fine, (ask for help if you should ever need)

But I really have NO idea what you are trying to say here.

I kind of understand the Obama News thing but I think you mean the "US" not obama.
Try ro be detailed, and give reasons of why you think WHAT about what you are writing or quotingl.

No idea what MN is and I guess R/R = Risk reward?

But again why, and what level are you looking at?

JUST AN EXAMPLE::::
ie 1655 buy with a ten USD appx stop @ 1645 because I dont see 1650 going due to the support in that area.

Maybe he is referring to Gold is on a 12-year hot streak

That's an interesting observation. Ignoring for the moment that the article was written more than four hours after vaidas7777 posted, perhaps you can shed light on specifically why "gold is a good deal now", what "MN resistance" is, in what way this is a "good position to make trades with r/r" and how this information was gleaned from the article you feel he was referring to.

Beeb

Pitchfork vs. Reaction -action lines- thanks for clarification, I have understood it as well by now. That was my fist attempt anyway to draw anything like this. Still, they worked quite well since Dec 10. . On Monday, the top line became as support instead of resistance. I am cautiously short XAG with 29,00 target in case Congress does not pass the Senate bill. But if I miss, no big deal- I do not see any explosions in PM prices as long as debt ceiling remains capped, so volatility may be quite big with every political statement. Even today , what house does, will determine how tomorrow trades begin.