Aug 29, 2011
Click HERE to view your gold tactics now chart. A lot of top callers went into seizure mode on Friday afternoon after 3pm, as gold marched higher, and continued to march forwards even after 4pm. Their master short positions burned up in minutes, impossibly. This is only a taste of life inside the parabola zone.
GoldLion notes that this massive loss booking on short positions and buying of longs was probably due to a lot of participants getting the COT liquidity flows report at around 34pm on Friday, the one that showed the banksters mauling the market with 40,000 buys, just thru Tuesday.
From the "it's all over" lows of $1705 on Thursday morning, gold surged to $1837 by the time the week-end rolled in, late Friday! Those who are not taking the crisis seriously and still think it's all about having fun "flippin gold for dollars" with leverage, are going to find themselves in some very serious and very hot financial waters going forwards.
The theme, here and now, is destruction of the flip traders. It's a massive blow to the egos of the pinbrains who demand to know what is next for gold, to drastically curtail the amount of trading, here and now, so they won't do it.
They can't, it's not in them. They'll actually try harder than ever to predict their way through the crisis, and odds grow by the hour that they will join Elmer Fudd in predicting themselves to the breadline.
The real life Sad Sack has revealed that other than a token holding of bullion and a mountain of failed penny stocks, his only gold exposure right now is one lone put option. What a horror, and what an indication that gold could be poised to enter the full parabola zone. I met Sack over the weekend after he requested an "urgent meeting".
I tell him the truth, but it has no effect on his actions and he is a phenomenal contrary indicator. The bags under his eyes looked the size of lemons, as he admitted he was barely sleeping as gold had marched $400 higher, with him standing there holding a bag of dollar bug peanuts. He looked truly horrific. His eyes had almost zero sparkle, he mumbled some gibberish about the next 2 days trading for gold being important, as always. Sure, Sack, if you say so; the next 2 days will determine whether central banks continue to revalue gold higher to end a quadrillion dollar OTC derivatives crisis.
I told the bustout that he should consider buying a 70-30 mix of GDX call to put options and rolling them over.... for the next ten years. Sadly, I doubt he can hold them for more than 10 days, without cannibalizing himself. Sack personifies the death of the flippers theme that is in play now. Picture a huge number of flippers in barrels headed for Niagara Falls. The river is going to turn red, as they hit the rocks below.
The timers failed totally at $1462-1478. They failed totally at $1650. They failed totally in the $1750-1915 area. Some of them, literally, probably don't know if they are long or short right now! Exponentially magnify the horrors endured by the timers from $1462 to 1915 by 100 fold, and you have a small picture of their coming bloodbath. It's the beginning of the end for them. When the monster gap days become reality, team stoploss will learn why I named them team takeloss. Team wiped out forever is what they will become.
If you want to know who the best flip traders are, the answer is they are the ones who are saying, "I've gone to maximum long on gold and gold related items with very modest leverage, and I'm holding those positions for years to come. At some point down the road the markets will get calmer and I can begin flip trading again, but not now." How many are saying that? None. How many will profit from this crisis? The same number. None. The crumbs of profit they have made over the past 11 years will all be taken away by the banksters inside the full parabola zone.
Having said that, it's all-key that you look down at numbers like $1200, 1300, 1400, and 1500, for gold. As we go into the parabola zone, the banksters will seek to cause enormous loss-booking frenzies amongst the fundsters and retail traders, like you saw last week, only in much bigger price size and velocity, financially and emotionally.
While upside reward is ever-bigger, so are the odds of massive sewing machine needle style thrusts to prices far below your entry points. Don't follow team prediction into the garbage can, and think you can predict the depth of the sewing machine thrusts, as the market gets wilder.
Focus on expanding your price endurance boundaries.That's YOUR solution to this crisis.
Sept 2, 830am: That's when the next jobs report will be released by the US Department of Labour. When is that? Answer: It's this Friday! It was GoldLion who really brought the "popcorn show" theme of the jobs report to you. Often going into the report there is downside action, and then when the report is released, gold blasts higher. Trading is usually extra-volatile around the time of the report.
Sometimes, jobs report day is a "dud". It's like a mini version of stock market hurricane season, which is the sept-oct time frame. There isn't a direct hit on the stk mkt every year, but when there is, the damage can destroy a lifetime of gains, in 2 months.
Elmer Fudd Public Investor knows nothing can ever go wrong with anything he buys, so he often loads up on the stock market right before crash season, to demonstrate how a rowboat can do well in a hurricane.
Being more risk averse, my focus in the food groups is corn and wheat. I'm a machine that buys them all the way to zero, and all I really have to say to Fudd when he tells me they don't pay interest is, "nor do breadlines, bud, have you thought about that?"
If you like action, however, you need to focus onsoybeans and sugar. ClickHERE NOW to view wheat and corn hand off the baseball bat to SuperBean, as she beats the dollar into tofu. An epic breakout has just occurred, so now the bankster games begin. Be sure you are trading smaller than rational, if you want to join SuperBean in action, beating on the dollar bugs.
Soybeans are a major food source for Asians, and prices must go vastly higher to avoid food shortages from morphing into starvation. I've called rice the world's most important chart. Most in the gold community, and none in the Fudd community, have any clue how serious this situation is.
I'll post a rice chart update on the site this morning. No, you can't buy rice in North American ETF markets. Focus on rice-related items. There's a massive H&S pattern on rice. In the punisher's parabola zone, rice could start to go parabolic too, and that could take the situation in Asian from riots to revolution, if it gets out of hand. Given the likely upside for gold, it IS going to get out of hand.
Gargantuan hits on gold will be brought in to lower the price of rice, wheat, soy, temporarily, to stop riot from morphing into revolution.
The mechanism of the hits will be huge increases in gold margins at the futures exchanges, going eventually to full cash markets, in various ultra-surprise night time moves, wiping out speculators with gap crashes beyond their current imaginations. Stop losses are meaningless in gap moves, and the banksters know this 10,000 times better than I do. The banksters will set all-time records for the decibel levels of their laughter, as they execute their plan perfectly, on the heads of the leveraged price chasers. Can you imagine arriving at the end of the crisis, wiped out, even though gold hit $10,000 or $20,000 an ounce? What a horror, and what a highly possible reality, for team leverage. I've mentioned Dev Cheekock at www.sproutfutures.com and if you look at his portfolio he's about 100% invested in gold/silver futures, based on the notional value of the contracts. 150% is heavy for him. He's not 1000% invested, because he knows what's coming, and what's coming is not party time for team leverage. Use options, in very modest size, with a long term rollover plan, to replace ultra-levered futures trades, before the banksters come after you like a flock of bats descending on a wide open red cross blood bank.
Those who think the Chinese central bank is buying gold because "they are so smart" need to get a grip on themselves. The bank knows what gold is, and is part of team global bankster, working to revalue gold higher to end the crisis. The reason the bank doesn't buy huge amounts of gold is because it would skyrocket the price of food, and 500 million Asians would, literally, take the directors out of the bank 30 seconds later, and rip their arms and legs off. If they were really "so smart", they would already be holding 100,000 - 200,000 tons of gold, not 5,000-10,000, and they would have paid no more than $500 an ounce for it, and they would not have bought US T-bonds and dollars at the peaks of those markets.
Take the food crisis seriously because it is going to be a big part of this super-crisis. Picture your grocery store looking like the Dow did in March 2009.
Gridtime. A very, very important reminder about money management relating to total portfolio performance: Let's just pretend, for a microsecond, that Elmer Fudd and his Golf Ball Advisor are incorrect, and gold is actually going to trade above $1000. Ooops, it already did, and then basically doubled from their top call. Let's further assume that Fudd really is going to the breadline, and gold really is going to $10,000 and higher. It doesn't really matter whether you have 70-%80% of your cash invested, or 100% invested, if gold is going to punish the dollar exponentially, from here on in, for a decade. The reason for holding 20-30% of your account in cash is twofold. First, there will be surprise hits, where you can allocate a bit into the pgen buy at levels you knew couldn't happen, but did. Second, there will bigger surprise hits, where you are too terrified to buy, and actually consider liquidating. You need a level of cash to manage those emotions professionally. Just the thoughtthat you have a solid cash level will see you stand strong, while the banksters dismantle those around you. While in theory the person who is 100% invested in gold will beat the person who is 70-80% invested in gold, in the real world, that rarely occurs, because the banksters are experts at crushing price just enough to put the 100% invested greed-a-holic into frenzied liquidation mode. Greed is a dangerous and powerful force that will be sending millions to a level of poverty that right now they don't believe is possible. Respect the force of greed, and manage the risks it brings to your table, with the highest professionalism.
Thanks!
Cheers
St out