Nov 4, 2011

GDX just jumped 10% in about 48 hrs. My prediction is that all leveraged traders and all price chasers will be destroyed in the reval zone. The reval zone is the deliberate and planned gold revaluation thru central bank buy programs zone.
We're on the cusp of the reval zone now.
Click this key GDX chart now. I'm using the colour purple to denote technical resistance that is created by a high. Resistance that is created by a low point is generally much stronger, or at least is far more practical for investors, and is denoted in red.
Price surged into the red HSR at $61 yesterday. GDX is now up almost 24% from the lows around $50, in just a month!
Price only fell about 25% from the highs near $67 on Europe crisis action. Those who bought the lows have already made what those who sold into the lows lost.
If you buy into the highs, I guarantee that you'll feel like selling into the lows, and I guarantee that a huge portion of the fund and gold community actually engaged in that horrific action recently.
I sold about 1% of my GDX position yesterday, and immediately bought paper gold bullion with the proceeds.
No growth in ounces of gold equals: A wealth building bustout. Don't let that be....YOU.
Some of you have wondered if the Gman will force institutional money managers to buy govt bonds instead of equities. First off, that's communism. You may need a full dictator in power for that to happen.
Second, it would likely close the financial system the second it was announced. I believe forced ownership of t-bonds is planned as an option, not as a given, but it will be used as a tool to stop any run on bank deposits, not investment accounts.
The deposits would be turned, partially or fully, into govt-guaranteed bonds of some sort, with some allowable and regular payouts, if we get to the point of bank runs.
The American Gman doesn't care if the Asian Gman dumps his price-chased US t-bonds or US dollars. In fact, that's the plan. The US Gman WANTS a devalued dollar, and bond selling by various bustouts gives him an excuse to order the Fed to print more dollars and buy bonds with the proceeds.
The last thing the US Gman is concerned about is a bunch of bond-owning bozos selling out at losses. He'll laugh his head off as they liquidate.
The world's Gmen, and the banksters, want a global govt, and US bond market carnage will fuel demands of the bond-owning bustouts to "do something, now!", as the bond goes south. The Gman will respond with aggressive (but fairly quiet) buying of gold and bonds thru central banks, and more buying of his own bonds with printed money.
He won't mention the gold buying, as long as he allows the public to legally buy gold, because the last thing the Gman wants is a public in gold-buying panic mode. He's trying to devalue them to the bread line, so he can save them with a new world currency and global central superbank, not send them into gold. So far, his plan appears totally on track!
The Gman might ban gold buying, if the crisis gets bad enough, but confiscation of existing gold is not likely an issue. Confiscate what? A few tidbits of gold from the gold community and confiscate the banksters' monster gold horde? That's not going to be happening.
A lot of bankster gold is now in Asia, and Asia is not going to enact confiscation. There's just nothing, in a practical sense, to confiscate. He could confiscate Fudd's bonds, and devalue those, but I think he'll just let Fudd bail in terror, and then save him with some soup and bread crusts, and a new global superbank, and a United Nations type of entity, only with much bigger teeth.
I'm quite worried that many who overbought in the gold juniors area, are not taking anything off the table into this strength, after making "I'm ruined forever!" statements into the lows. If that was you, you need to look into the sanity mirror and get your positions to something realistic. Don't book losses, but book tiny gains to get your positions into the reality zone.
That sept correction was just a tiny intermediate, and arguably a minor trend swing. Now the price chasers, personified as "Sir Gusto", are back at the dollar trough. Sadly, Sir Gusto will become Sir Busto. You can call that a guarantee. "I'm invincible, because gold just rallied for a week!". Is there possibly something a teeny tiny bit wrong with that statement?
Prices change over market time. Emotions don't. Very few understand this, the greatest fact of markets.
Click this silver pennant chart now. What a work of art! Unfortunately, it's only 2 days of time. Time, time, time, that nasty like item! Analyse charts of long periods of time. Use short term charts to manage your emotions.
This pennant chart is a silver cheerleading chart, and suggests a possible burst higher today. Cheerleading is important. If you can't stay in the game, you'll never profit from your long term analysis. Likewise, when the chart looks ugly, put your buy orders in, turn the machine off, and get out of there.
Click this dow chart now. There is a mini flag-like entity that I've highlighted in turquoise. Crash season, aka Fudd loss-booking season, is over. Remember, don't even think about buying the Dow unless it has fallen 1000 points at a bare minimum from the latest high point.
When the choice is between making a bet on the Dow falling down and you making some dollars, or buying gold, my suggestion is to surf across the dollar bug cesspool with your gold bullion surfboard. Hey, look, isn't that Fudd down there at the bottom of the cesspool, borrowing money from a bankster to get 5% reward on a junk bond that has a 90% chance of declining 90% in price in this crisis? Let's wave to him as we surf by.
Gridtime. If I had to guess, the next "2008 again" will be caused by the first major selling wave that hits the bond markets. There is likely to be widespread institutional belief, and massive propaganda from the banksters, that rising rates spell doom for gold. Massive doom. Not little doom. In the long term, they will be wrong. But when it first happens, their liquidity flows could ravage gold and gold stocks. You'll be 50,000 times more afraid than you were in 2008. Steel yourself today, for what you can't predict tomorrow, because it's coming. As I send this off, the silver pennant has blown apart. Well, place your buys and press the off button for awhile on your quote screen. You can set alarms that email you when certain prices are hit, so you can come back to party time. Step up the emotional preparations for the whipsaw zone, or you won't make it thru there financially alive. Spend more time looking at the quote machine when price is up, and very little when it is down. If you like....WINNING.

Thanks!

Cheers