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Gregory Mannarino
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I started my financial career working for the securities and trading arm of the now defunct Bear Stearns before the dot-com bubble. I am an active trader of the capital markets. I have published several books pertaining to finance, global economics, and equity trading. My most recent book is... More
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Ultimate Guide To Money And The Markets..
  • Ukrainian Military Attacks Russian Convoy! Stock Market Dives.. 14 comments
    Aug 15, 2014 11:48 AM

    (click to enlarge)

    Ironically just last night I wrote an article in which I said:

    "barring a geopolitical event the US equity market would likely hit new all time highs within 2 weeks."

    Well it appears a geopolitical event has occurred, and I am expecting Russia may now escalate it's military action in the Ukraine.

    Eye on gold. You would expect that this event would have pushed gold higher, however at the time I am writing this blog gold is under pressure. "Gold" may be telling us that despite the abrupt hit to the stock market, (the markets were modestly higher just prior to finding out the Russian convoy was attacked), this "dip" in the stock market may be temporary.

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Comments (14)
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  • mus
    , contributor
    Comments (46) | Send Message
     
    I agree ... not for the faint hearted though ...
    15 Aug 2014, 12:13 PM Reply Like
  • johndr
    , contributor
    Comments (25) | Send Message
     
    I took a long position on the S&P this morning based on your opinion Greg that the market was likely to go higher. Thankfully I was able to move the stop-loss to break even before the sudden fall. My shorts on the S&P, DAX and FTSE (all December) are now doing well. Like you, I was surprised that gold didn't rise but your explanation may be correct. Keep up the good work! John Roycroft
    15 Aug 2014, 12:40 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    This is a very high risk strategy , more indeed ahead of the week end , the thing is though , the Ukraine issue , has been so beaten down already , that other than a major head to head confrontation with Russia , everything else is pretty much discounted , I would be extremely surprised if Putin went ahead , and deploy his military in the Ukraine ... he has all the time in the world to let this situation rot , now that we are getting closer to the fall , and with the gas taps on his side of the border ...
    15 Aug 2014, 12:48 PM Reply Like
  • Gerrit Govaerts
    , contributor
    Comments (4) | Send Message
     
    This is factually not true . Gold was slammed way before the news came out (with a typical big naked short ) and then when the news broke it recovered all losses . There goes your argument out of the window
    15 Aug 2014, 02:26 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    @Gerrit , man , what he means is that gold did not react as aggressively as the stock market did , one would have thought gold would have claimed back its loses from yesterday given the volatility in the market at that point in time , instead it stopped at around 1305 . Look at silver and it will give you a clue where paper gold is going in the short term . If gold thought there was real danger based on the news we got it would be much , much higher . Anyway , nothing written in stone , but I agree with Greg that looking at the gold action , one would think twice before shorting the stock market here , thats all
    15 Aug 2014, 02:35 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    If by monday , nothing extraordinary happens , and you have to take the word extraordinary with a whole new meaning , since downing a jet liner hasn't affected the markets , do you think blowing away a few trucks wether true or not , its going to cause much anxiety ? If nothing happens by monday , expect paper gold to get whacked , mark my words . Piece of advise , dont chase pm stocks , gold , precious metals on geopolitical , chances are you will get massacred , buy pm stocks when they are fallen off the bed , and short them on geopolitical shennanigans ... good week end
    15 Aug 2014, 02:56 PM Reply Like
  • Gerrit Govaerts
    , contributor
    Comments (4) | Send Message
     
    @mus . Dunno if you follow the price action in the gold market , but gold slamms are a very fequent occurence especially in the morning . Only lately , gold price recovers all the losses in a few hours of trading . BTW , my gold stocks are up 7 % since I bought them mid July . I am doing fine thx
    15 Aug 2014, 03:09 PM Reply Like
  • Gerrit Govaerts
    , contributor
    Comments (4) | Send Message
     
    @mus . My argument is that Gold would have risen to 1327 if it had not been slammed before hand . So it reacted as it is supposed to do in times of uncertainty . Afterwards , it did taper a bit down , I do admit that , but saying it is under pressure is a bit exagerated given it's healthy reaction on the news
    15 Aug 2014, 03:00 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    With all respect Gerrit in my opinion what you are saying is wishful thinking , the only thing holding gold at the moment are geopolitical issues , it doesnt matter wether you think or I think that it should be much higher , it is what the market thinks , or what the market is being fed to think .. by the fed ... lol .. and the market is thinking right now that the stock market is the place to be . You are right gold was slammed before the data , but my friend gold has been doing that for the past two years , nothing new there ... dont fight it , embrace it , trust me .
    15 Aug 2014, 03:13 PM Reply Like
  • Gerrit Govaerts
    , contributor
    Comments (4) | Send Message
     
    It's not only me who thinks a) this market is forming a top and maybe ready for a serious correction and b) gold miners are a buy right now , but it seems George Soros is having the same ideas .
    http://cnb.cx/1oBvivH
    http://bit.ly/1oBvk6K
    15 Aug 2014, 04:43 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    I completely agree what you are saying is in the cards , about the miners I also agree , I buy them all the time , just not yet . Soros has been buying gold stocks for quite a while , he was buying last year out of the money calls on GDXJ , the timing is very important . You and I are talking different time horizons I guess .. I was referring very short term before , sort of next week .
    15 Aug 2014, 05:17 PM Reply Like
  • cassano
    , contributor
    Comment (1) | Send Message
     
    i dont get it - why would gold go down if the geopolitical news was bad and why would this signal a quick rebound
    15 Aug 2014, 03:45 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    because the rallies that you normally get based on geopolitical issues is 80% short covering + 20% sheep heading to the slaughter house , as soon as geopolitical issues fade , shorts get back at it . We all know what happens to the sheep. You are right , geopolitical news are bad , and most people would buy gold , shorts see it differently , they see it as a great opportunity to short an overvalued asset , inflated because a bunch of sheep are running scared that the wolf is going to come ... 8 out of 10 times the wolf never comes ...
    15 Aug 2014, 04:08 PM Reply Like
  • mus
    , contributor
    Comments (46) | Send Message
     
    Apparently , no trucks found to have been destroyed , what a joke MSM has become ...
    16 Aug 2014, 04:33 AM Reply Like
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