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Gary Tanashian is proprietor of and Actionable, hype-free technical, macro economic and sentiment analysis is provided in the premium market report 'Notes From the Rabbit Hole' ( Complimentary analysis and commentary is available at the... More
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  • Gold This Morning: Not With a Bang, But a Whimper --Jon 3 comments
    Oct 15, 2010 9:57 AM | about stocks: GLD, SLV
    Modest overnight volume within a convictionless $7 trading range contradicts the seeming flocks of camouflaged messages cautioning gold commitments as we tack on new all-time highs. GSR continues easier at ~56.30 this morning and while this level is looked on as overly satyric (as in the devil made me do it) by some who drew a line-in-the-sand when it was in the upper 60s, rest assured it remains the same leading indicator that caused no such consternation when at higher levels it brought smug informed opinions of the pending deflation. Open interest on Wednesday's monumental volume only increased 11,000 contracts (1.7%) hardly the stuff of parabolic tops. Option vols continue to inch up and at-the-monies are now around 20 and still distant from the 30 levels that in the past put hard thinking in a correctable state. Today: Let's wander through Poets' Corner and remind ourselves that life does not imitate art as in the prosaic end-of-the-world and in fact exaggerated market moves always end with a bang...and we are not there yet...even if it's Friday do not be lulled by the lazy sideways move; you are reminded that after early weakness last Friday, we managed to tack on a $25 move.

    Disclosure: No positions mentioned
    Stocks: GLD, SLV
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  • doubleguns
    , contributor
    Comments (9700) | Send Message
    Jumping up and down. Buying dip showed up.
    15 Oct 2010, 10:01 AM Reply Like
  • Gary Tanashian
    , contributor
    Comments (99) | Send Message
    Author’s reply » Can't hurt DG!
    31 Oct 2010, 04:00 PM Reply Like
  • Will Laing
    , contributor
    Comments (2) | Send Message
    Sitting in my backyard the other day it came to me an idea about gold buying/investing. What sparked my thinking was a news report I heard on the radio I carry around with me to keep up on what's happening. The news report wasn't anything revealing, but just a general report about gold prices. Now I hear gold is up to $1600 an ounce. Okay. But here's what I thought. You know who the winner's are in this gold market? Those people who are selling the gold. No one else is going to make any money in this skyrocketing prices for gold. And the idea I had about gold was, it is going to go down eventually, and when it does people are going to dump as much of it as they can to take advantage of whatever they can get for it at that moment, as it continues to go down. As a sidenote, I've seen this for many, many years that when gold starts going up the economy is going down. When gold goes down the economy is going up. That may seem naive on this site with everyone being into investing, I'm probably out of my class on this one. But I want to make I guess what is obvious to people, but maybe some aren't wanting to look at like this. And that is the people who are selling the gold will also be the people who will be buying the gold back when the price starts falling. So dealers make money when gold goes up, because more and more people are buying it from him, and basically he can charge as much as the market will bear. But what makes the difference is he will get all this gold back which makes him more money just because of his holdings in gold, when people start dumping it as the price begins to fall. In one case he exchanges cash for gold, and in the other he exchanges cash in exchange for gold, but here's the catch in the dealers advantage, and that is he is having to pay out less and less money for gold people are selling as the price goes down. So he's loosing less and less money as the price goes down, and gaining more and more gold back in return for it.


    Am I way off on this or what? It just seems to me that if you go out and buy a bunch of gold right now at $1600 dollars an ounce, and the price goes down tomorrow you cannot protect the value of your investment because it's loosing value you can't stop, the longer you hang onto it. Let's say you have $50,000 in gold, and you decided to hang onto it even if the price went down to $450 an ounce. You'd have a lot of gold that was worth only a fraction of what you paid for it. What do you do with it? Sit on it in hopes the price will go back up to $1600 again? I would certainly hope that it never goes up that high again. And it's because of what I said that if gold goes up the economy is going down. I don't want this economy to go down any further than it has already because it's killing us. You can't buy water when you are thirsty and the guy who has the water isn't taking gold in exchange for a drink of water.
    24 Jul 2011, 11:47 PM Reply Like
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