Seeking Alpha

It's "death bells" for commodities, says Citigroup, calling 2013 the year in which it's realized...

It's "death bells" for commodities, says Citigroup, calling 2013 the year in which it's realized the commodity supercycle is over and a new era in which the relative performance of how "stuff" performs against each other and other assets is what matters. Specifically on oil, Citi calls Q1's move higher without merit and expects the recent downtick in prices to continue.
Comments (70)
  • The Fed is worried about inflation since there has been a pretty significant uptick just recently so they have the bailout stooges POUND (GS, C ...) on commodities. They are desperately trying to keep inflation expectations in check. However these currency wreckers know they must keep printing with 1.1 trillion dollar deficits and commodities go up fast in such reckless behavior.
    Something is really up since this coordinated attack on commodiites came out of nowhere. So you believe GS C the Bernank or Grantham.
    12 Apr 2013, 03:06 PM Reply Like
  • Feds reckless behavior and commodities going up fast....you better chech your charts....or if you believe that, go buy some gold.
    12 Apr 2013, 03:14 PM Reply Like
  • actually H bought some physical silver eagles today from a panicking holder today at spot. So yes the Fed and their stooges are succeeding in cracking the PM sentiment. This is their intention imo. They are going to break the backs of these amateur holders while China, Russia, Brazil, and others scoop up more PM with foreign reserves at cheaper prices.
    These manipulators are pros and see that many of these commodities were sitting at important technical levels. So they brought out the crooked troops to carry out their mission.
    12 Apr 2013, 03:18 PM Reply Like
  • What kind of eagles have you been buying Hammer? I've recently been picking up some myself.
    12 Apr 2013, 03:58 PM Reply Like
  • bought several '09 1oz US silver eagles at (26) spot today from panicking holder.
    12 Apr 2013, 04:11 PM Reply Like
  • Coordinated attacks? Specific examples? The way commodities are trading it appears deflation is more on the horizon than inflation.
    12 Apr 2013, 05:57 PM Reply Like
  • The Fed can not do that because it would be treason assisting our enemies.....I forgot what bankers can do
    12 Apr 2013, 07:21 PM Reply Like
  • Hope you did not bought gold @1900.
    There are many Gold postmortem analyses, good doctor's made early gold illness diagnosis (see this prediction from January 8):
    http://bit.ly/11USVC6
    Good Luck!
    13 Apr 2013, 03:54 PM Reply Like
  • Thank you for being so concerned but no I started buying in 2003-2004 for both gold and silver; also I heard many, many times already that it was the end for gold and silver but they always came back; since gold went to above $1,900 and silver to about $50, the Fed has employed their killers in GS and JPM to smack down their price regularly early in the morning; no bs who in their right mind would dump gold and silver on the way down unless you have very deep pockets? yes, you should show some concern for Bernanke too, because he is trying to prevent the house of cards from falling.
    13 Apr 2013, 05:46 PM Reply Like
  • I remember back in September when $GS said 2013 would be a great year for commodities. I dont believe a word these guys say.
    12 Apr 2013, 03:09 PM Reply Like
  • Would not be surprised one bit if the banksters and large hedgees were given the green light to short the hell out of commodities with the Fed backing. The F system is so corrupted and distorted at this point in time.
    12 Apr 2013, 03:14 PM Reply Like
  • Agreed. Don't forget they can lever up to buy Gold at firesale.
    12 Apr 2013, 04:08 PM Reply Like
  • lol @ citi analysts, maybe even better fade than Gartman
    12 Apr 2013, 03:26 PM Reply Like
  • Find it interesting that APMEX a large PM dealer will buy '13 silver eagles at 27.93 which is nearly $2 over spot.
    12 Apr 2013, 03:32 PM Reply Like
  • GLD filled in another gap today at $143.80. Next downtrend is at $136 but would anticipate that GLD rebounds on Monday as it tries to establish a bottom. Based upon volume it looks like capitulation but would wait a few days to see how GLD responds to today's action.
    12 Apr 2013, 04:17 PM Reply Like
  • Sorry about that it actually filled the gap at $144.80.
    12 Apr 2013, 04:30 PM Reply Like
  • Last fall Citi called for gold to go to $2500 and the Euro to go to parity with the USD. These guys just make it up as they go along.
    12 Apr 2013, 04:23 PM Reply Like
  • Absolutely right. It never ceases to amaze me that no-one ever does a look back to see how accurate someone's previous Comments/Forecasts were when they come out with a forecast like this. My granny could come out with a new forecast every day if no-one looked at how good her previous calls were. Note how you never see another Wall St analyst bashing a forecast made by a rival - you (don't) scratch my back ...................!
    12 Apr 2013, 06:47 PM Reply Like
  • If the economy is really doing well (as implied by the WS), there is no reason for the commodities (especially the oil that this analyst seems to include) to go down. So, something has to give. The GDX next support is 31 and GLD at 130. After that it could be a free fall to 17 and 116 or 106. I wonder would that happen (and if so, it would drag the full market too in my opinion) or as another commenter pointed, other countries would come and scoop up the materials (literally) then breaking the dollar. After all, they have been running scared for a number of years holding the dollar bag and it would be a God send one time opportunity for them. A nice Nonlinear dynamics play with a number of variables for an Engg. Prof. to watch and admire (But again NL systems can become chaotic in a minute!). Luckily I have my savings fully in cash and can use that free fall.
    12 Apr 2013, 04:34 PM Reply Like
  • The US economy is going down not up. Money supply will get squeezed and gold will slide until stimulus as the US slips towards recession before ever recovering from the last one. Welcome to QE America where capitalism and the capitalistic dream is over. Money printing to enrich those who don't deserve it or even earn it is destroying the merit of wealth and money just like in a communist system.
    12 Apr 2013, 07:49 PM Reply Like
  • I fully agree. I am one of those that do not deserve to be rich but getting rich regardless. I love it!
    12 Apr 2013, 08:48 PM Reply Like
  • This drop in gold prices clearly shows that we are having massive inflation and the dollar is being debased.
    12 Apr 2013, 05:26 PM Reply Like
  • Actually it's the opposite...DEFLATION.
    12 Apr 2013, 05:55 PM Reply Like
  • You clearly do not follow shadowstats.
    12 Apr 2013, 06:18 PM Reply Like
  • Do they chart the incident at Roswell into their thesis?
    12 Apr 2013, 06:30 PM Reply Like
  • Deflation what Bernanke bonds buys or where bubbles are and then deflate...inflation when $$ goes down and everything get repriced up because of the US dollar currency status
    12 Apr 2013, 07:12 PM Reply Like
  • Macro is being sarcastic as usual.
    12 Apr 2013, 07:13 PM Reply Like
  • Thanks for the buying opportunity!
    12 Apr 2013, 05:34 PM Reply Like
  • What a !@#$% joke of a market by the way.
    12 Apr 2013, 05:34 PM Reply Like
  • Dont fight the tape. Gold is in trouble. Time to duck and protect capital. Once things settle, we can talk about inflation, printing money and other contributing factors. Right now gold is in a major downdraft!
    12 Apr 2013, 05:58 PM Reply Like
  • Only if you are not a moral person. If you are a real man you would go triple long gold right now. Remember that you are only losing fiat money, but you are gaining real gold.
    12 Apr 2013, 06:19 PM Reply Like
  • What if masdaqwoody is a woman with breast implants?
    12 Apr 2013, 06:26 PM Reply Like
  • A real woman would know not to listen to the BS from right wing talk show hosts about gold.
    12 Apr 2013, 07:12 PM Reply Like
  • "
    Only if you are not a moral person. If you are a real man you would go triple long gold right now. Remember that you are only losing fiat money, but you are gaining real gold."

     

    Exactly, bought me some gold today. And I am so far ahead on gold and silver in the last ten years that this thing is going to have drop a lot lot farther to put me in the red.
    12 Apr 2013, 07:57 PM Reply Like
  • Do not stop buying till it puts you int he red.
    12 Apr 2013, 08:53 PM Reply Like
  • Ain't going to happen.
    12 Apr 2013, 11:45 PM Reply Like
  • So long as you buy bullion; if the dollar fails any paper gold will disappear with it.
    12 Apr 2013, 11:59 PM Reply Like
  • Wait a minute, I get all of my investing advice from Rush Limbaugh!
    14 Apr 2013, 09:45 PM Reply Like
  • Rush is buying. He is even using his drug money to buy gold now.
    16 Apr 2013, 01:54 PM Reply Like
  • Now that gold has broken through what the technicians thought was 'support' (guess it wasn't), there should be more selling fueled by margin calls. Another 10% to 15% haircut would probably be enough to cause the weak holders to capitulate and then we might see a turn around. The Goldman Sachs sell call was somewhat encouraging in that many calls they have made in the past turned out to dead wrong and perhaps self serving. Does anyone believe they issued a sell call on gold because they are concerned that investors may be hurt by falling prices? Yeah, right.

     

    I am old enough to remember the 70's gold craze that sucked in a lot of people who just couldn't get past the fact that gold had gone parabolic to $850 and therefore "must" go back up. After collapsing to $300, there were two rallies over the next few years that stopped at $500. The moral of that story is that caution is advisable here and please don't bet the farm on this pig.

     

    I have a few bucks riding on gold and will add to it if we get a nasty sell off but I won't be hanging on to it dreaming about $5000 an ounce. I'll leave that to the die hard goldbugs.
    12 Apr 2013, 07:31 PM Reply Like
  • Still holding NUGT?
    12 Apr 2013, 07:36 PM Reply Like
  • Yep... big haircut on that one. I always limit any position to a small portion of net worth so the hurt is limited. There will be no capitulation selling by me. The financial pain is acceptable as it teaches me not make stupid investing mistakes and being long the miners was truly a stupid move. That said, I haven't entirely given up on them but wouldn't consider adding to the position without seeing a good washout decline in gold and today's 5% drop is a pittance that won't shake out to many bulls.
    12 Apr 2013, 08:54 PM Reply Like
  • The fed is apparently about to unleash a bunch of interest rate hikes to try to cool down the obviously overheating economy. It can raise rates because we have finally eliminated our massive deficits and slashed our overall debt. Now that surpluses abound and all this "debt ceiling" talk is behind us we have reached somewhat of an economic nirvana. Savers are about to be handsomely rewarded with much higher rates on their deposits and everyone who owns bonds can now calmly exit their funds with nary a loss so they can get ready to reload again at much higher rates.

     

    Gold is appropriately getting dismantled in this environment and I suggest capital punishment for anyone holding it throughout these rough times as they have been actively thwarting this recovery.

     

    Anyway, everyone buy stocks and rejoice. All is well!
    13 Apr 2013, 07:01 AM Reply Like
  • Just look at Citi's recent acquisition's,Ed,D,Duk...
    12 Apr 2013, 08:24 PM Reply Like
  • Time to buy some gold!

     

    Let it fall to 1400 or whatever they say. If the Fed is really doing something to fix the price of gold then it is good for me!

     

    The same people telling you to sell gold are buying the stocks that have ran up for 5 years.

     

    You get in when the price has fallen some.

     

    Gold price fall=Buying opportunity. No technical analysis or research needed.
    12 Apr 2013, 08:44 PM Reply Like
  • The Rocks being squeezed .
    13 Apr 2013, 05:17 AM Reply Like
  • I think people new to the gold market have mistaken the past few years rise as normal market behavior . If gold rose at the same rate as the last 5 years it would be worth around $45k per Oz within 15 years ...This im sure you agree would be completely unsustainable as I feel is the gold bubble we are still in now , without the global panic gold would be in the $6-800 range right now , no higher. be careful buying into it .
    13 Apr 2013, 09:13 PM Reply Like
  • The thing that should scare those who have a goldbuggery fetish is that there is still no long-term capitulation in gold (as indicated by volume of GLD), and the inflation adjusted price of gold is still in the top percentiles relative to history.

     

    Oh well, another 30-40% haircut in the price of gold should silence the gold bugs for another 20 years or so.
    12 Apr 2013, 08:48 PM Reply Like
  • 54 million shares today when it averages about 10 million is a close as capitulation as one could expect.
    13 Apr 2013, 12:21 AM Reply Like
  • I think the possibility that the central bank of Cyprus may be forced to unload upwards of $500M in gold reserves onto a weakening market (reports which began circulating mid-morning) had a lot to do with the accelerated price decline in bullion.

     

    The protests in Greece over Eldorado's project and Barricks delay by Chile didn't help the miners either, even though a reduced supply should have bumped the price of gold in the real world. Odd coincidences for the week.
    13 Apr 2013, 05:46 AM Reply Like
  • Proclamations by these "expert" investment banks are either years early or years to late. They are salespeople..period. 99% of the time they are doing the opposite of what they are telling the public.

     

    There is not a shred of evidence out there that the US is improving it's fiscal house. If anything things are going to get a lot worse as raising of taxes and printing of currency are the only solution to today's very real problems and tomorrow's future entitlement disasters.

     

    50 million Americans on food stamps.
    100 million Americans not working at all (out of 350 million Americans).
    3/4 of all Americans with zero net worth and minimal real retirement savings, which means never ending government support just to survive.
    These are facts that every single one of the investment banks and most TV personalities will ignore.

     

    The best way to prepare now and in the future for those of us who can:
    Yes the stock market and dividend paying stocks to create that stream of never ending income in the future. Also we do own physical precious metals (not ETF) for any future situation and wealth diversification
    .
    And why wouldn't one own precious metals?

     

    A woefully uneducated American public has no clue that through the ages, those in power, with real net worth etc. have always owned precious metals as part of their net worth. They go up and down in value however they are not purchased for that purpose. Once someone understands that and does not expect to see stock market like returns from owning precious metals, the price of the metals on any given day/month/year become meaningless.
    You want to own it as part of your family fortune forever. That is the key to owning the physical. When you understand that, these proclamations from the likes of Citigroup become meaningless and outright laughable.
    13 Apr 2013, 11:03 AM Reply Like
  • Unless you choose to ignore the evidence and 100 million not working out of 350 million will have me asking do you have a link to this?
    13 Apr 2013, 11:38 AM Reply Like
  • http://bit.ly/156ep1z
    13 Apr 2013, 12:30 PM Reply Like
  • Wow that's about a 5% drop! Really making waves about 5%?
    13 Apr 2013, 06:50 PM Reply Like
  • This Gold tankage reminds me of the AAPL tankage. I was a fanboy and lost my shirt. I kept buying and holding and looking at each drop as a "buying opportunity." LOL. I was always long and never short. What a mistake that was!

     

    You have to ride the trend, and right now that trend is down, and has been down for a loooong time.

     

    If you don't know how to trade, keep buying or holding and pray a lot. That strategy never worked for me. A better way would be to set your RSI at a period of 2, and either buy or sell Gold when the RSI peaks or tanks. It's a great indicator.

     

    There are opportunities to make make money in Gold. You just have to be on the right side of the trend. If you're long, you're on the wrong side of that trend.

     

    Hope this helps, Gold bugs.
    13 Apr 2013, 05:37 PM Reply Like
  • I suspect next week GLD will trade sideways as it looks to consolidate if possible after a very big volume day of over 50+ million shares.
    13 Apr 2013, 06:52 PM Reply Like
  • You could be right. I'm short ANV right now, and may have to exit that trade and lock in my gains early next week. We'll see what the RSI says to do.

     

    Trading can be really simple if you just look at the RSI before pulling that trigger. But sitting on massive losses during a long term downtrend, and then adding to the losses with the many "buying opportunities", and hoping for the best, just doesn't work, at least in the short term.

     

    If you want to let your money sit for years and not do anything, that's another choice and may eventually pay off.

     

    But doesn't it seem better to actually try to make money, instead of just sitting on massive losses and doing nothing? Buying and holding long term can be a fatal mistake.

     

    Jumping in and out, going long or short, and following the trend is the only way to go in my book. This applies to all stocks. GLD, SLV, UGL, ANV, AAPL, you name it, they're all the same. They're just a trade, and if that trade is going against you, get out. Cut your losses, preserve your capital, and move on. You can always go long when the time is right.
    13 Apr 2013, 08:24 PM Reply Like
  • The problem with RSI and Stochastics is the info can be lagging.
    13 Apr 2013, 08:30 PM Reply Like
  • It's a lot better than guessing.

     

    Besides, If the RSI is set to 2, and it's getting near the peak or bottom, you can see that and act accordingly. You may not buy or sell at the exact right time, but you'll be pretty darn close.

     

    Oh, and it's better than guessing.

     

    I saw BBRY was near its low on the RSI on Friday near closing, so I went long.

     

    The last time the RSI was at that point, BBRY jumped 35% in a few days, and has always jumped at least 10%.

     

    So buy BBRY on Monday, everybody! lol.
    13 Apr 2013, 09:57 PM Reply Like
  • A lot of the more bearish calls take gold down to the ballpark of its mining costs. Can a metal go lower? Sure, for a while - even an extended while. But eventually miners will slow or stop production, which will impact supply.

     

    And the thing about production costs is that they are going up by about $100 per ounce per year, as ore quality depletes. I'm not sure if mining costs will continue to go up at that rate, but if they do, in just a couple years time we're looking at mining costs about where today's spot is.

     

    Nothing is safe. Sitting on cash isn't safe. But if you have time to consider long-term endeavors, gold at these levels is about as risk free as you can get.
    13 Apr 2013, 09:35 PM Reply Like
  • Disagree, pmiller100. What if the market crashes, and you're on the wrong side of the trend? Will you just sit there for years, a captive to your trade, hoping for a comeback? What if the market crashes, and you were on the right side of the trend? You just made a fortune, and can cash out and look for other opportunities.

     

    Holding long can be a very risky play. Gold has been dropping for 19 straight months. Why not make money on the short side?

     

    1. Never fall in love with a stock or commodity
    2. Don't trade against the market. You will lose money.
    3. Treat Gold like any other trade, and either go long or short, depending on the trend.
    4. If you're in a bad trade, cut your losses and get out. Preserve your capital.
    13 Apr 2013, 10:13 PM Reply Like
  • The best way to do gold and silver is a hedge against cash.

     

    Cash is dropping in value. THis is certain. So one has to own gold and silver. THEre is really no choice.

     

    Gold and silver only went into stronger hands on Friday. If the selloff continues it will shake out the weak players. The PMs are desirable with cash not getting enough interest income.
    13 Apr 2013, 10:24 PM Reply Like
  • Gold is just another trade. You will either make money, or lose money. Cash is cash, and we can buy things with it. And it's fun to accumulate it. Cash isn't going anywhere. Don't be fooled into thinking Gold will protect you from cash that suddenly becomes worthless. Your only goal should be to accumulate as much cash as you can, and then spend it. If Gold can help you do that, great.

     

    If not, look for another stock to trade.

     

    People have been gettin fear mongered into buying gold all through the downturn. Your goal as an investor is to make money, or it should be.

     

    WAG has been real good to me. It's a stock I'm long in, and it's trending up, and I'm making money. Funny how that works.
    14 Apr 2013, 02:35 AM Reply Like
  • "Can a metal go lower?"

     

    pmiller, your comment assumes that demand for PMs is fixed and/or growing.

     

    You are taking this assumption, and applying it to supply-demand, in order to support your belief that PMs and/or miners must bounce.

     

    You may want to consider if your assumption is correct.
    14 Apr 2013, 08:33 AM Reply Like
  • ??????????

     

    Gold certainly does protect from falling value of cash.
    14 Apr 2013, 11:57 AM Reply Like
  • All of what we do is pattern analysis - even the fundamental analysis in the end is pattern analysis, albeit using different data than do the TA folks and then correlating that to past patterns. So we make assumptions about what from the past is likely to provide us with a constant against which to judge new variables.

     

    One of the oldest economic constants - probably the oldest period - has been demand for gold. That constant goes back, what, four thousand years or longer?

     

    Yes, tomorrow everyone could wake up and jointly say, you know, I don't want the yellow metal anymore. And all the art critics could say, you know, that stuff in the Sistine Chapel isn't all that great, and the Vatican should replace it with paintings of dogs playing pool.

     

    But I doubt that will happen. It's never happened before. I do assume there will continue to be demand for gold. So if supply of gold available for sale (not the broader 'supply' of all gold processed, including that stored away in vaults) diminishes, then I do believe price will go up.
    14 Apr 2013, 07:29 PM Reply Like
  • Mano - there's trading gold like anything else, and there's using gold as a store of wealth. If you're looking for a trade, you can ride trends, or you can be a contrarian and attempt to catch the reverse trends before they happen. Either can make or lose you some money.

     

    But both the trend riders and the contrarians know that trends don't last forever. One just is looking to get off the ride before it changes direction, and the other is looking to get on it right before that change happens. As you know, there's also varying groups of traders who try to discern the exact moment when, with the idea that's when they'll get on.
    14 Apr 2013, 07:36 PM Reply Like
  • looks like an international conspiracy. Think Fed is a party ?
    14 Apr 2013, 09:05 PM Reply Like
  • Absolutely. The Fed is always partying.
    16 Apr 2013, 01:54 PM Reply Like
  • Did anybody catch Kudlow this morning talking about Gold? Hilarious he bascially lambasted his own advertisers because they were everywhere (including he said his own show) about misleading consumers. Way to go Larry now that gold has collapsed your right wing credibility goes further into the toliet as long as they were helping pay your bills. What a tool.
    16 Apr 2013, 06:52 PM Reply Like
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