I had gains today thanks to my oversized EXK, AG and RGLD positions. But, I shouldn’t get too confident about retaking any lost coin, on the long side, anytime soon. When I take my head out of the sand, I see torched buildings and body parts strewn across the landscape. My original short thesis revolved around a strong dollar, strong US treasuries and high volatility. You can witness all of the things I predicted in the charts of UUP, TLT and TVIX.
With Italian, Spanish and French yields elevated, as well as Belgian, you’d have to be out of your fucking minds to be long here, unless your name happens to be Lord Fly, Master and Commander of all things to do with Fantasy and Wondrous Turkey Galas.
I have no business being long shit like LULU and RBCN. I’ve hemorrhaged millions over the past week, stubbornly ignoring my own gameplan. Germany has said, repeatedly, they are not interested in Euro bonds. Now the Fed is mandating US stress tests for some big banks, under a 13% unemployment scenario. Can they see the future?
If you just stumbled onto this site and have an interest in an objective market view, from someone who has successfully navigated down markets like this, you’ve come to the right place. All positions aside, the market is in danger of a serious dump out. Crashes do not occur from elevated levels. They are a result of mass panic, caused by macro capitulation. I just took on a new account today and I bought him NGD. Gold and silver are the only assets worth acquiring, in my estimation. Having said that, if the deflation demon really takes hold, both gold and silver will be decimated.
In my personal/aggressive account, I opted against going “all in” on an egregious option trade, in exchange for some AG common. I was thinking irrationally yesterday and needed to smack myself to get my brain back on track.
Bottom line: the market is OVERSOLD, but nothing extraordinary. I like my chances long, only from a unrealistic, crazy policy marker bonanza point of view. If judging purely on logic, something that has been an outlier in this market for 3 years, we should trade down hard over the next two weeks, led by commodity related stocks.
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First!
NGD nice call
For PM play, why choose silver rather than pure gold. Silver has industrial use and tend to follow general mkt.
If you belive oversold mkt can be more oversold and mkt will down hard in next 2 weeks, why don’t you preserve cash and wait out?
strong USD seems cut into strong PM play.At least partially IMHO.
Silver has correlated just as good with gold on up tapes. I have RGLD too.
If we are so weak and on the verge of a full-scale meltdown, why did silver stocks surge higher? This isn’t coming from a perma-bull here. Rather, I’ve been short for the last couple of weeks. Trying to look at the real evidence and not just confirmation bias, because there’s plenty of that out there if you’re short.
Silver stocks were very oversold. Obviously I think PM’s will do well regardless of market conditions. The only thing that rapes PM’s is massive deflation aka Europe.
The only time the PM stocks did not go down in a market meltdown was in the ’30s (deflation and not inflation) when the entire market consisted of HM (Homestake) and Dome Mines.
They crashed in early ’80s, 1984, Oct. 1987,etc (recall what just happened in ’08).
ALL paper is trash in a market melt down.
Where a crah occurs the metal spikes up and drags the mining companies along and the when the margin calls hit, it’s adios.
Need to be nimble or else.
Forgot to add that I believe it isn’t really an inflation-deflation argument but rather one of where real rates are in the cycle. Negative rates (when the cost of borrowing is below the inflation rate) are good for gold.
Good points TC.
yep, useful discussion.
I’m 100% with you, Le Fly. I myself have basked in the glow of my short thesis. But you know something? Despite being “right,” here we are, treading along DOW 11,500. The strength in the face of these negative headlines has been amazing. The price is what’s always right. I look at it this way: if we are, indeed, on the verge of a full-scale swoon lower, then my God it will have been one of the most telegraphed legs lower EVER. There is a strong, underlying bid to this market. I have no idea where/who it’s coming from. I think Chuck’s feelings on ZIRP really are what’s holding things together.
Well I compare it to leading up to the 08 drop. I was short forever waiting for that. Never came. Then those fuckers announced the stimulus and the market went up 5 percent overnight. I closed the shorts and just knew we were going lower. It did but I was sitting in cash like a dickhead but didn’t want to chase the tape. I feel between now and January we will see 10 percent plus downside. Fly is most likely correct, however, bounce around until jan then the shit hits the fan
Something is afoot, and somebody knows. Ben’s new stress tests, the IMF balogna today, debt ceiling impasse, MF, JEF, CBK…whatevah…making my hair stand straight up.
Somebody tweeted it was GS that sold hard into the close. What did Kerry do today???
Stress tests will lead to monster rally in banks. This is a show.
Hello FLY I would like your oppinion on trading vs. Investing. I just finished reading intelligent investor and BG Benjamin Graham says trading is a foolish game to play. How do you feel about this? Any insight on this?
There are many games. Almost everyone thinks that the game they play well is the only one. If you think Graham is right, then try paper trading for a while and try paper investing for a while, and see where it gets you.
You see, this is an empirical question. That is, it can be answered by experience. The answer depends on what works for you, which depends on your skills, personality, and whether you use indicators that work a lot of the time vs. indicators that work less well than a coin flip. Some indicators seem to be just superstitions that seldom work. Stock trader’s almanac used to have some stats on back testing results of various indicators and probably there are stats on the web somewhere.
Any game involving the market is unlikely to be successful without long hard study and some trial and error experiences. Lots of folks are selling lots of systems. If someone tells you they have the Holy Grail of Trading, run don’t walk, in the other direction.
If you are unsure and just starting out, then you may want to follow along with some highly skilled folks for a while and see how it’s done and on what basis they enter and exit trades. I think RC and Chess are doing that kind of thing with 12631– specific trade entries and exits with the rationales for entering and exiting.
Ya think GS or Kerry knew about Dexia?
I once read a quote along the lines of: “At the end of the day, the market rewards those taking positions that are “hard” to take on, mentally. There is no easy trade that isn’t already crowded”. It’s something that I keep in the back of my mind when I get overzealous regarding a position. Hopefully mother market brings many more riches to you in the near term, sir.
I think Germany will come around, given enough time. The question is whether they will come around while things are bending or wait until they break.
Austerity for its nearby trading partners is already biting hard.
FRANKFURT (MarketWatch) — Germany’s central bank on Monday cut its forecast for German economic growth in 2012, projecting gross domestic product to expand by 0.5% to 1% versus an earlier prediction of 1.8%, Dow Jones Newswires reported
The slower the German growth, the worse its own sovereign debt situation will look. Compare Germany to Spain in this graphic, and you see that the Germans don’t have a lot to brag about:
http://www.mint.com/blog/trends/then-and-now-the-european-debt-crisis-112011/?display=wide
The Germans have a strong export economy going for them, but, in my barely informed opinion, the bigger factor in the treatment of German bonds is the fact that Germany has an outsized influence on ECB policy. Betting against the German debt puts you in the crosshair, and Germany controls the trigger.
http://tinyurl.com/6s9uo5q
Food futures DBA , are now more undervalued relative to GLD Gold, than at any time in the past 3 years.
If silver and gold turn up here, wouldn’t DBA and RJA have two to three times the bounce potential?
If the market trades down hard the next two weeks, miners typically trade with the market, no? I am long the miners, too. I have a different and probably quite plebian view of why grains, softs, some metals and meats have fallen from precipitious levels the past 3 months. Yes, supply and demand issues, but also hefty speculation during QE in most of 2010 and 2011 was what drove them up. I’m more cash heavy and yet I am not even thinking of a market crash. I am wondering, Fly, if being longer than you’d like in some positions is causing you to be overly reactive, no disrespect intended.
Where do the YTD returns stand?
I’ve been watching the correlation between stocks and gold. In the passed few years it seems gold has bottomed 5-6 months before stocks.(This is just looking at my charts, I haven’t back tested how true this is)
Saying the above, wouldn’t it be reasonable to assume stocks won’t bottom till February?Don’t get me wrong, I’m not saying silver STOCKS move lower. Just stocks outside of the PM space.
Assuming silver and gold have bottomed.
http://www.aei.org/article/economics/fiscal-policy/the-rising-threat-of-deflation/
This story, although dated in July of 2010, explains your concerns about deflation in Europe, Fly. Now I get it.
thanks flyaway, good reading
http://www.american.com/archive/2011/november/its-europes-economic-growth-stupid
Your welcome Mahk Bert, my own clarity and knowledge of the issue led me to the site and it actually looks pretty interesting 🙂
lack of clarity and knowledge lol
I think it is your clarity and knowledge that makes it interesting. Rathah than your lack of such! lol
I summarize this article:
PRINT MONEY OR DIE!
Austerity doesn’t seem to make much sense when you read Lachman’s views; he had some decent charts and graphs in a Nov. 2 report.
(don’t count this as advice, just my thoughts) Fly, I know you hate charts, but the miners (silver at least) all show long term topping patterns on the brink of completion. I almost took SLW short at 36 (but didn’t because I suck). There is still the possibility of a this being the end of a consolidation leading to another leg higher, but my bias is to the short side based on the overall market and distributive action in most of these names. In general, the more support is tested, the more likely it is to crack, and all of these have either tested multiple times or already broken major support
SLW
http://screencast.com/t/muK8dDjGn
EXK (notice prior breakdown indicating weakness and failure to reach prior high)
http://screencast.com/t/gdFoIy2kXA
AG (broke down out of consolidation on major breakaway gap – very bearish)
http://screencast.com/t/FVYIv55Y
the gold charts aren’t as bad but don’t look great
IDK, I am just a basic crayon, draw trend lines and look for near-term support moving averages kind of person. On a one-year weekly it appears the 100 EMA has provided support for SLW although you are right about the topping patterns in your charts. For EXK, on the weekly the 50 EMA has been a decent place to buy since June. I bought AG yesterday after looking at finviz chart of AG and seeing that it seemed to garner support near a trendline below $14. Nowadays it seems like everything is a day trade anyway, lol.
here we go mhass here we go WOO
OEW Daily Recap: Meh …
“The rally off of today’s SPX 1182 stayed within the range of yesterday’s afternoon trading, (SPX 1183-1198). On the charts it just looks like a consolidation day after yesterday’s decline.”
“However, there is a short term positive divergence in place, and these usually precede an overbought condition near term.”
“Short term support remains in the 1168, 1176, 1187 pivot cluster with overhead resistance in the upper 1190s and the 1222, 1240 pivots.”
Hey Tea, thanks for your post on OEW and JAG. I sold half my JAG the day the news broke of an all-cash offer. I am really debating whether to buy more if it dips to the low $7s, which it did (7.13) the day after. I just keep thinking this company will likely say they’re worth more and scare the Chinese away. Personally, having followed this company for a couple of years, I think extraction issues loom large and expensive and they should take the offer and run. JMO
I thought they fixed that extraction problem hence the last big rally off the surprise earnings last qtr when I sold … I’m watching but waiting to see if it drops when they refuse the offer in which case I’d get on board but if they decide to shop it with a price in mind then it could be dead money for awhile and it may be better off to look elsewhere … JMO
Personally looking at a basket of micros as an alternative … BAA, MDW, CGR, BRD, VGZ, GPL, MVG, FSM with a sprinkle of SWC. Prioritize the North Americans over the Australian and South Americans though.
NGD looks like $11.70 may be doable with a hard stop just below the hammer just in case.
Fly,
Do you plan to fill your twitter stream with brainless drivel regarding the Republican debate tonight?
Why don’t you touch upon the 500 million dollars the guy you voted for in 2008 spent on the failed solar company Solyndra.
Let’s hear your opinion on how Michelle Bachmann dress looks.
I would rather hear the much told story of how svelte Michelle 0bama’s arms are…nevermind her thunder thighs…
How big is Michelle Obama’s ass? Has there been an accurate measurement done?
I’ve heard hear mention what some 3rd grade kid in Cleveland should be eating for lunch but I’ve never seen a tape reading of the circumference of her ass.
How about you touch on the fact that the guy you voted for in 2008 has grown the National Debt faster than any other President in the history of this country.
Cheese
I shit on Obama daily. Let me have my fun making fun of Cain and co.
Fly,
How about we talk about the FUCKTARD you voted for in 2008.
Cheese
Banned
He didn’t mean it.
He had a bad day playing Pinehurst No.2.
And check the Futes- fair value shows now down over 100 on DJIA.
A bad round of golf is an excuse to pester the host? I hope he doesn’t eat Twinkies, too.
The ole’ Twinkie defense.
http://en.wikipedia.org/wiki/Twinkie_defense
When I was in school I was renting an old house (very drafty) about 2 blocks from a Hostess factory. The smell would permeate the walls when the winds were right.
We would go there and buy day old Twinkies and Susie Qs and freeze them.
Very good stuff and I can understand the Twinkie defense.
Some people aren’t managing millions Fly, don’t “ban” cheese, “refrigeration”.
He meant no harm.
America can’t stand, esp. afford, HOBOama anymore.
He’s outta Hopium, and been on vacation or golf outtings, when not having Chinese-week-long galas, at US taxpayer expense. Talk about outta touch.
They’re def. not looking forward to the liberal, by def. arrogant and ignorant, “in-laws” who will provoke blood pressure for pleasure either.
As for me, being a Boss, “suchness” never occurs.
The Germans are a smart people, yet they are driving a supercharged Mercedes right off the f****** cliff! I drove by a lot full of $51,000 300 E class sedans on the way home from work. Someone needs to go over there to those blonde idiots and yell all over the countryside and in their paper rags HOW FUCKING worse off will they be when that same overpriced sedan now sells for $76,000 in D Marks. If they don’t power up the ECB overnight and PRINT!!!! and also wrap up all the southern PIGS debt into somewhat ECB (ponzi) backed aka Federal Reserve Euro trash bonds we are all fucked! I am afraid to go through another 2008 or worse and I will fly over there Madmax style and find those German pricks and pull a Hitler on them.
josh.
read a few self help books.
Relax.
Sonny boy.
Relax.
They aren’t interested in printing to prop up a-holes who aren’t going to change their habits. That’s not a winning strategy for Germany.
If it’s between death at the hands of foreign fools, or death by their own will, Germany will (and are) proudly take route 2.
Who lent the money to “foreign fools”?
Futs def. not looking good. Anybody here still long beside TeaHouse??
I think Tea’s east coast VTII.
Don’t hurt his feelings, Rx costs, you see.
I look to the Hang / Nekeii at sunset, then Euroland’s markets (e.g. CAC, DAX) at midnight, if intere$ted, in relation to SP.
This helps with hedging.
FYI.
I am long. But short GOOG in decent size as well. Long WNR, RIG, GGN, HSY
Come back in the morning
Disclaimer: I am long.
I she tumbled on this website looking for “asian midget clown with lasers on their head porn” and MVIS/Broker A “The Fly” showed up.
My email to Dickie Roberts who is running as a representative:
Thank you for your service. As a fellow pilot, I commend you.
Math trumps ideals. Since well before LBJ ,our society has become a nanny state.
This country needs to get back its roots of rugged individualism and state’s rights. As a country, we simply can’t continue to spend more than the government takes in in revenues. This is a recipe for disaster.
In order to continue as a society and restore confidence in the democratic process, we must do a few things:
1. Indict Wall Street executives and their proxies, top down. John Corzine, Dick Fuld etc…
for the fraudulent pracrices in which they engaged.
2. Put term limits on both houses. If it is good enough for Presidents and governors, it is good enough for senators and representatives. Career politicians are caustic to democracy.
3. Make all stock transactions by our elected officials transparent(i.e. reported within 24 hours on a publicy accessible website)
4. Have an honest discussion with the populance explaining promises were made that should not and cannot be kept( i.e. Social Security/Medicare/Medicaid to the detriment of future generations.)
5. Inform the rest of the freedom loving world that we are not the world’s policeman. If they want want to exist under the umbrella of freedom we provide, they better pay for it.
Solid A+
You are right on target.
we watch greece and still dont see…
I have a long rod that breaks up a pile of shit stuck in the pipe.
I guess my long stocks will look like that pile of shit soon.
if u use a camera u can avoid the explosion
.
SHORTER … than Verne Troyer !!!
.
I assume the world is ending?
Yessah!!
Welcome back Mr. Shorty!! How are your overall positions sitting these days given the October rally? Hopefully you are ready to bounce back hard and consign that ridiculous October rally into the smoking street-pole ashtray in which it belonged…
I literally scratch my head (chimpanzee style) … in utter disbelief … at how unnecessarily difficult … some here choose to make this !
Quite hilarious … actually !
.
Alf
You really should start a blog in the iBC Blogger Network. It would be hilarious.
Fly.
Where’s V.King?!
Let’s get to the real issues here.
… an actor preparing for a scene might ask himself …
“what’s my motivation?”
—
THAT … seems to be where I’m at with that prospect !
As of yet … I am unable to come up with an answer that would motivate me to put forth the daily discipline required to “bring it” … DAILY !
Thus … why bother !!!
—
But … there’s ALWAYS tomorrow !
Who knows what “tomorrow” brings !?!
.
o brother.
puuke.
… so articulate !
Perhaps YOU should start a blog !
BWAAA-HAAA-HAAA-HAAA-HAAA-HAAA !!!
.
(BRA places pointer and thumb into brow).
Right Alf. Right.
V.King!
Hi, Alf. Good to see you.
YO, frog !!!
.
!!!
and its all a game but when the music stops, theres no chairs left. everybody is? and your sperms in the gutter , your loves down the sink ……..50% gold /50% cash .i sleep well
Something tells me you know how to party re.
I think we should start to consider that the market was overbought since months…
What the crude price is doing in the 90’s ?? Should be in the low 80’s high 70’s… That doesn’t make sens…
Seriously, what is it that drives politicians? I couldn’t imagine doing that for a living.
Well, they get to serve their country to the best of their abilities.
There’s also the best healthcare, pensions, easy money, illicit money, easy women, illicit women, and young juicy pages of both sexes parading around your office in tight little pants.
Everyone wants to remodel one of your estates, too.
Here’s a work schedule for Congress from Uncle Jay:
http://youtu.be/IsWlkcsI5Ko
.
I need to run for Congress…LMAO.
You guys are missing the sell off trigger tonight folks.
Dexia appears to be going to down and France’s AAA rating is going to go down with it:
http://www.zerohedge.com/news/dexia-bailout-verge-collapse-threatens-take-france-aaa-rating-down-it#comments
This may very well trigger a massive CDS meltdown.
The banking collapse scenario in Europe is becoming VERY REAL.
I had the story up on iBC news before he posted it. However, he did email me the story first.
Oh noes. Not more bad news from the Eurozone.
I hypothesize that all our problems started with George Washington’s invention of cocaine and fucking of bears. He got pissed off that Tyrone Busch and Michael Coors outmanuvered him in alcohol production. Their extensive use of child labor caused bear-fucking George major headaches. Eventually, he started a war with the English, which was won by and large by the French. He passed on his wooden teeth to Robert E Lee and encouraged him to raise llama eggs. And that is why why we have ham and llama egg salad in the south for thanksgiving.
I’ll have my $ back soon!!!! Yessah!!!
I just read an article saying that because the major indices are not tanking (even with all the bad news)they might indicate house cleaning in the next election. The new group will do what needs to be done. I do wish I could believe that.
On the contrary, I believe that the indices simply indicate massive manipulation of every market out there.
It appears to me that the upcoming 2008 cubed event (in 1 to 3 yr) will take everything down again, including pm’s.
But the pm’s will superball off the lows & head skyward. I will hold some physical siler thru out, expecting the gold silver ratio to return to 15ish.
unrelated song: http://www.youtube.com/watch?v=4kTzT3saWJU&feature=related
News like dexia effects the market. But usually it’s an excuse rather than a reason. I’m still seeing a rally – maybe tomorrow or Friday. How heavily it’s sold into is what I’m really interested in.
The 60-day moving average on silver has rolled over to the downside; and the 200-day looks ready to roll over as well.
This chart does NOT look bullish to me.
http://www.kitco.com/ind/Nadler/nov222011.html
Yes, but you are fucking idiot, correct?
Scott B. – Futures showing 1170.
It looks like Scott nailed it again.
Kudos
Well at the very least, we know the october jump was BULLSHIT
Ridiculous. Which many and I said but could only seem dismissive at the time. Not claiming a victory just pissing on stupid tv anchors that wanted to declare we must be fine. Ridiculous.
The best october in 30 years? Yeah, maybe the biggest headfake in 30 years
HSBC China PMI sucks. Like duh. Maybe I will finally get back to the level the market was before that silly Oct rally started.
You and me both..
with the ultra short VIX names getting sold off hard into the close, we do appear to be a minority.
Poof, your bullshit rally in Silver is gone.