Graceland Updates 4am-7am

Nov 26, 2009

1. On and on. Technically, there is a lot of clarity on the major market charts now, and has been for 2 weeks. Indicators and oscillators that are speaking volumes.

2. For the past two weeks I’ve posted very few charts. I write here in the newsletter what I think works. Each time I look at a chart I think, “Is this something my subscribers respond to with action? Or I am simply posting a chart on the site to fill space?” Despite some fabulous-looking charts, I didn’t believe those charts would result in you taking anything buy harmful action. Harmful to yourself.

3. The last thing I wanted was a truckload of subs who thought, “I see, so these indicators are overbought, I’ll go short now!”. When gold rose up from 905 towards 990 I spoke of the coming “time of the gold PLAYER”. A break over the neckline of the head and shoulders continuation pattern neckline would see the professional investor make GOOD money, but the PLAYER make REALLY BIG MONEY. The professional buys only weakness and sells only strength. The player operates in the market only a few times a year.

4. I also mentioned that those betting money against the major gold trend would be obliterated. While there isn’t much left of the gold top callers except dollar dust, I believe their actual obliteration is yet to come. The coming obliteration of the gold shorts will usher in the era of gold volatility as well. From the rise over the 1033 area highs, gold has moved like a moderate speed freight train.

5. If you are an amateur chartist who was blown away by the “impossible strength” in gold to the current 1195 highs (call it 1200 for practical purposes), what you just experienced was perhaps 5% of the adrenaline rush that is likely the NEXT train station stop for gold.

6. All the passengers will be ordered off the gold train as the conductor says, “this train is out of service, we have arranged alternative transit for you, please proceed to the new gold passenger transport vehicle.”

7. A nuclear powered gold WHIPSAW.

8. In the past I’ve also detailed the absolute critical importance of understanding that technical indicators can STAY overbought for a long LONG LONG time. Today is CROSSROADS day. We’re here at gold 1200. The public investor losers treated gold bullion like a penny stock. “Yeah, I’ll put 10 grand in that.” THEY are the penny stock. NOT gold bullion. THAT is a FACT.

9. But who cares about the world’s worst investors. Millions of them are headed to the bread line. Let’s focus on YOU. For YOU, today is decision day. Not tomorrow. Today. The gold charts are very overbot on the daily and weekly charts. Not on the monthly charts. Gold stocks aren’t nearly as overbot as gold. You know I’ve been using bullion profits to buy gold stock.

10. Decision Day. Trader Dan Norcini says there is nothing but AIR between gold 1200 and gold 1700. The question is not whether gold is about to leap to 1700 or not. The question is: Are You Prepared?

11. You must be equally prepared for price strength and price weakness that exponentially exceeds your IMAGINATION. All other thoughts define you as somebody who thinks you know where the market IS going. Think about that carefully. Are you really prepared for gold 1700? What about gold 600? ALL is POSSIBLE. Very possible. Read on and you’ll see why BOTH could occur in a very short time but not in the order you think.

12. Decision Day involves the implementing of tactics to handle those possible realities. The gold bears have jumped on possible increases in gold futures margins. Here’s a wake up call to Mr. Golden Bear: This isn’t 1980. The DOLLAR was soaring in 1979. The dollar is in MELTORAMA mode right now. What COULD happen now, and I believe odds are high that it DOES, is this: the comex hikes margins. That causes selling of paper gold but a then an unbelievably huge surge into physical gold. The gold longs don’t want to be out of gold. They want more. This situation did not exist in 1980.

13. A charge from the comex into the physical gold market could cause MAYHEM in the gold market. Let me tell you something about the physical market. It is SUPER TIGHT. Dealers are being RATIONED. Some have had their supplies cut FIFTY PERCENT. The physical market stands to get ASTRONOMICALLY TIGHTER. If the comex went to a physical/cash mkt, the price of physical gold could rise hundreds of dollars in one day. What? Yes, RISE. The comex price would initially tank as the longs were liquidated. But then, perhaps within hours or MINUTES, the price could erase ALL those losses and SKYROCKET as a big chunk of those longs (accompanied by huge money that sensed the squeeze on physical gold) STORMED the physical market only to find the banksters saying, “there’s none, we’re out! Sorry. Ok, here’s a few grams at $1700 an ounce. You’re welcome. Come back next week and we’ll have a few more. At $2000.” The open interest on the comex tanks, the price of gold becomes a yo yo. Anyone who could not meet an INTRADAY margin call would be liquidated.

14. If YOU are still playing gold futures margin man you have just been told. The INFERNO is coming and it may be DAYS away. The entire WORLD GOLD MARKET is about to turn into a CAULDRON.

15. Are You Prepared?

16. Tactics. Having me blab out possible events makes you ZERO. My advice to margin traders who have no ability to meet an intraday margin call (electronic brokers would liquidate you and full service broker “pals” would be ORDERED to have the money on HAND and PROVE it within an hour or all undermargined clients are LIQUIDATED. Your pal connections would be 100% USELESS).

17. This is the BIG SHOW and it’s about to BLOW. A funny rhyme. Funny…but only if you are long and strong. With no margin. If you are in the opposite position, you risk doing your laughing from the bread line at best, the insane asylum at worst. The bullion ETF’s that are using derivatives and/or have low odds of having the gold they promise, are at major risk of EXPLODING. They could trade to near-zero in a market-based “we don’t believe you, where’s our gold!!” terror sell, mass hysteria panic selling. GLD-nyse is FRONT AND CENTRE in that regard. I’m 100% convinced that if this occurs it will feature the banksters, literally, taken to the hospital by ambulance with permanent breathing problems. From laughing so hard at your total destruction in the gold market at the hands of their master plan.

18. The gold PUNISHER is about to take action on ALL those who helped turn the GMAN into an EVIL blob that does nothing but EAT.

19. The BREAD LINE is a reality that the market fools of the world will find goes from a joke to a FULL REALITY in a time frame that is like: flicking a light switch.

20. So, what are the tactics to use so you are prepared? First, for the non-futures trader, the regular investor: Physical gold bullion for your core positions. Trade paper gold core positions for physical IMMEDIATELY. I’m ringing the gold market alarm and it’s a FIVE ALARM fire I’m predicting. Don’t sell the paper gold today and think “oh I’ll rebuy my physical on a correction”. You don’t know what you are talking about. Throw that fantasy in the garbage. Make sure when you sell the paper you buy the physical at the same time. Lock that price in and get the money to the dealer. I’ve spoken about price air pockets. Now, think TIME air pockets. And think, “What if there isn’t one?”

21. Next, futures traders that are on heavy margin: Consider buying gold call options. I really don’t know how the comex could respond to gold call options if they took the futures to a cash market. I would NOT bet money on what their actions would be in the options market.

22. But if they did attack the options, you would experience only a small loss, but options involve very little NOTIONAL money on the line for the contract. You are buying an option on 100 ounces of gold, like an option to lock in a buy or sell price for a house. So if it all goes bad, your loss is small.

23. I think somebody who buys far out of the money options, BOTH puts and calls, could make a KILLING. IF the banksters decide to keep the options market alive.

24. I told you all from the starting gate: The banksters are LONG the most PHYSICAL GOLD. The destruction of the comex, and then the global gold OTCD markets, is going to see the BANKSTERS make a massive fortune in gold. And when it comes to handing out the physical gold that IS at the comex, WHO do you think is FIRST in line? YOU? NO. It’s THEM. They hold almost as many longs as the fundsters do.

25. I own options. When one of these SUPERPLAYS presents itself, which is what the gold continuation head and shoulders is, a SUPERPLAY, I want IN. But I’m 70% professional, 30% player in my personal character as best as I can estimate, so I buy options to keep the risk SMALL but still participate in the PLAY.

26. The gold bears have talked about gold 600 and silver $7. That could happen INTRADAY if the banksters pull the comex trigger. That’s the POWER they hold. Gold could go to 600, then shoot to 1700 in 24 hours. Are You Prepared ? I have no interest in predicting price points for the gold whipsaw. My interest is in seeing you are not cut up like carboard by a bankster chainsaw.

27. For those who don’t want any options, even the multi year long term options, here’s how to prepare: focus on the following and do it MANIACALLY: Make 5000% sure your market ORDERS are IN the market. Do it TODAY. BEFORE you eat your turkey. Or YOU might be the gold turkey served to the banksters’ kids for dinner!

28. When the volatility goes NUCLEAR, and I give you 99.9999% odds it WILL do that VERY soon, gold market liquidity could careen from endless to zero repeatedly in a terrorizing series of gargantuan whipsaw price ACTIONS.

29. This is an EMERGENCY situation. You must act NOW if you are one of those in a weak situation, soaked with questionable ETFs, futures acnts with huge margin. Or you will be ripped to pieces by the banksters and maybe within DAYS.

30. Let me explain to you how the comex bankster superplay could go down, how it likely WILL go down: YOU have an account with a broker. Electronic or full service. THEY report to a CLEARING HOUSE. They do so DAILY. They report the total longs and shorts, and margin positions.

31. The clearing house reports to the EXCHANGE. The exchange, the comex, might say to the clearing house, “look, we’re going to 100% margin for the gold and silver markets right now. The banksters will be buying everything you liquidate but we’re pulling the price limits and the banksters may not come in for hundreds of dollars with serious size. Your people could be getting fills hundreds and hundreds of dollars below the market price now. Now it’s show time: Tell your brokerages that clear thru you, they have an hour to be 100% on side. In 60 minutes we start mass liquidation of your positions.”

32. The clearinghouse tells the brokers, “The comex is going all-cash right now. You got 30 minutes to get $10 million down here or I liquidate 90% of your positions to bring you onside.”

33. Institutional money smells a rat. Remember the RECENT words of Paul Tudor, “the gold bull market is only just starting”. For myself, I’m adding to my “investment portfolio”. To diversify my weekly trips to the bank to remove cash, I’ve begun adding in REGULAR weekly purchases in the grocery store for dry milk and foods. I don’t know about you, but if I’m going to line up for bread, I’m prefer to do it… at home.

34. By the way, our own double doctorate subscriber, “the brain”, has been taking handgun lessons. I wonder why that would be…

Are You Prepared?

I’m going to the gym now. After I return I’ll be on standby all day long. Ready to answer any and all emails with an eye towards ACTION. Try to keep them as short as possible. Let’s have a flow to things. When an email requires long and complicated thot, I store it and attempt to work on it in stages. That may or may not get completed.

Have a Happy Thanksgiving.

And A Prepared One.

Cheers,

Stewart Thomson