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Gary Tanashian is proprietor of Biiwii.com. Actionable, hype-free technical, macro economic and sentiment analysis is provided in the premium market report 'Notes From the Rabbit Hole' (http://biiwii.com/wordpress/about-nftrh/). Complimentary analysis and commentary is available at the public... More
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  • Gold 'Community' Revving Up On Iraq 1 comment
    Jun 13, 2014 8:54 AM | about stocks: GLD, USO, SLV, UNG

    They are getting excited again, the gold 'community' that is. On the big bounce in GDXJ (juniors) especially, there is talk of bottoms, new up legs and even the potential Inverted H&S NFTRH has been charting since before I even heard of it anywhere else.

    This may or may not be the case. NFTRH has been on the IH&S for many months now and I'll be damned if the 'callers' are going to co-opt our theme. But insofar as Iraq has anything to do with anything, it's 'buyer beware' on this hype.

    Here GoldCore weighs in…

    Gold, Silver, Oil, Gas Jump on Middle East "Powder Keg" Concerns

    Why, they even have a cute Power Keg pictured with a long wick laying next to a couple of match boxes labeled 'War' and 'Chaos'.

    To be fair, they do mention an actual potential fundamental for gold in that "the US recovery may be stalling", but you know the 'community'… it is going to pitch whatever is inflammatory enough to get the troops motivated and pumping.

    I would venture a guess that a sizable chunk of the gold 'community' wants war and it wants Chaos because it wants to be right and it wants to get back up on the soap box with a booming I TOLD YOU SO!!. Again, not so much talking about GoldCore as the usual barkers. You know who they are.

    But this crap has nothing to do with gold's fundamental backdrop. I think many readers of biiwii.com know my view on that and on the b/s that so readily gets stirred up on the internet when it comes to gold, which is a simple and enduring monetary value asset.

    The bear market has driven home to me just how many pitch men and charlatans a good chunk of the 'community' are; stumbling all over each other to make 'the call' and not giving a damned about how said call - coming straight out the wrong orifice - can affect regular people, who maybe depend on 'analysis' they read in their decision making.

    So today's deprogramming and debriefing is this; if you are bullish on gold you'd better be bullish for reasons other than what is going on in Iraq as gold and oil pump together.

    Themes: gold, iraq Stocks: GLD, USO, SLV, UNG
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  • prattner
    , contributor
    Comments (35) | Send Message
     
    Bah. Of course Iraq has nothing to do with the price of gold, why should it? What is irritating is how some of the usual suspects start attributing the recent modest rally to Iraq, and who are then quickly followed by their opposites who ridicule the charlatans' call that Iraq is gold positive, thus unintentionally lending credence to the very IDEA that events in Iraq may be responsible for the small gold rally, which magnifies the gold rally.

     

    This, in turn, causes a small gold sell off when the news cycle inevitably begins to forget about Iraq, because the speculators think that other speculators will think the end of the world did not come, thus gold should sell off. So it does, probably at resistance so as to intensify and snowball the crowd's conviction that gold is going down. The whole affair is...tedious. And vexing.

     

    The frustrating truth about gold is that the recent short term rally in gold needed no event to make it move up, nor did the recent drops need an event to make it go down. It is just speculators chasing each other's tails.

     

    Ultimately, it will go up because the central banks of the world are printing money and they simply cannot stop for long without bankrupting their own governments. How long that takes is anyone's guess, but you can be sure it will be longer than you thought possible, and with many more maddening drops, sideways consolidations, head fakes and loop-de-loops than most people can possibly tolerate until it suddenly shoots for the moon.

     

    Good luck out there.
    13 Jun, 12:04 PM Reply Like
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