[o2ny]

I would say you were 100% correct about metals this week... especially silver. As soon as Buffet announced that he sold all his silver I should have known what was coming. The herd players all got in a couple weeks ago on news and momentum and just built a bubbling froth of 'irrational exuberance' that was bound to come crashing down.

As soon as people on the street start talking to you about how much their gold rings are worth, you know it's time to sell... (which is exactly what happened to me, except I haven't sold because my gold positions are still way up from 450 last year).

I'm glad to see this correction so gold and silver can go back in the 'shadows' and begin the nice, slow & steady low-profile bull run that was meant to occur in the face of dollar decline and oil prices.

[clueless]

I just about made a bullion purchase yesterday, but decided to wait until monday..

Can - Regarding these EFT's can anyone make a suggestion ?

I cannot much information about them on the web.

[pb_2_au]

I'll take a stab at this...

Gold we're gonna touch 565 or perhaps 548 a couple of times really quickly and then we'll hover low 600s like it was before the run above 700. This is just where a new base is building. As the magnitude of the downturn hits people harder there will be more upside.

Silver will hit that 11.70 mark again, but I don't see the 10's there's just too much upside bug in people's ears about Silver, being a safe haven and an industrial material.

Eventually that $850 record is going down on this bull run for sure, and who knows where Silver will be at that point.

I like my long equity positions overseas, in countries not highly reliant on US trade and with good int'l diversification (Singapore,Malaysia). Short on the risky lenders now, but there is prolly more downside to the HBs as well, waiting for a little bounce there.

Also, I had to sell off my alt energy (PBW) ETF I think free flowing investment capital will be hard to come by and a lot of the concept companies will shrivel up. Too bad there wasn't more investment during the good times.

Sold off 1/3 my Au but holding tight to my Ag, FXE is 1/2 my cash.


Next week is new home sales and durable goods Wed (5/24), existing home and GDP on Thursday.

Hold tight, it's gonna get rocky, if you've gotta go away on vaca, think of the most radically negative situation you can tolerate for your open positions and close out the ones you need to in case it
is even worse for you than you can imagine.

Good LUCK!

[deconstructionist]

$this->bbcode_second_pass_quote('Dukat_Reloaded', 'I') wouldn't read too much "PRO GOLD" news. You probably found that artical at kitco.com, all they do is print and link to articals that are pro gold.
...

[greenworm]

What a crazy week!! I shorted every major gold mining stock on last friday morning and cashed out today on all of them.
You know what they say about "buy and hold", buy and hold nothing. I think next week will be less bumpy(hope not), but should start trending upward. I am looking forward to the mastercard ipo, should bring in some speculation. Everyone has debt and with increasing energy costs, everyone should have lots of debt unless leveraged against that sort of thing.

[basketballjones]

$this->bbcode_second_pass_quote('basketballjones', 'a')sk him where he has his clients stocks. i bet they're in the broader stock market.

i don't know about oil and copper, but i'm confident gold will close the week higher. the gold supression scheme is coming undone and is the reason behind the recent runup and will continue to be one of the main drivers behind the continuing increase.

[green_achers]

You boys mind some dumb questions? I'm semi-retired and have been buying the physical stuff since December, just a bit at a time, and now have a modest amount in a safe deposit box located in another town. A mixed bag of Au and Ag (bullion bars, coins, rounds, and a few commemoratives I got for spot.) Mostly just for peace of mind, maybe 1-2% of cash-type assets.

What I have no clue about is the type of trading you're talking about, e.g., "long", "short", funds, mining stocks, etc. I don't even know how you go about buying such a thing or keeping up with it, except for kitco.com and a few other links I've found, where they speak whatever foreign language y'all are using. Do you use a broker, or have accounts with Ameritrade or something? What about the Kitco gold and silver accounts? I guess I need a basic primer. I'm thinking the insights provided by being PO aware could help me, but would have to do a lot of homework first. As I have said elsewhere, market forces are still real.

[greenworm]

Hey green_achers,

There is no such thing as a stupid question, only stupid people who don't ask questions! With that said, if you have any question concerning terminology I suggest investopedia.com and look for the glossary link. This contains every imaginable phrase that has any relationship with the markets. Very cool! To trade mining stocks, yes, ameritrade will do, there are countless others, I recommend doing research on all of them to see who will give you the best deal. Shop around, some will give $5 a trade with no hidden costs. Using a broker is probably not a good idea, basically, you are paying someone to do what you could easily teach yourself with in a couple of hours. Kitco account? Not sure what this is, sorry. Long --> "hold your position for a long time, this could refer to stocks, commodity contracts, the gold you have in your very hand", short -->"when you take the position that the price will fall, (usually with borrowed money)" Let me know if I can answer any questions about stocks, I stay away from commodity trading as the upfront cost doesn't justify the eventual return in my opinion.

[Marklar]

what you will find discussed frequently on this board, and especially in the "traders corner" thread is people talking about trading futures contracts. However, with the new ETFs we recently got we now have Gold, Silver, and Oil ETFs that can be traded with an ordinary stock broker account. Instead of trading futures you can trade these ETFs which look and work like stocks but give you exposure to the prices reflected in the futures.

As far as the terminology, investopedia, as greenworm said, is a great resource. I used it to learn about simple options trading and selling short.

Going long or taking the long position, means you are buying a stock believing it will go up in price.

Going short is just the opposite. You believe the price will go down so you want to sell. But the point of selling short is that you don't have to own the stock. Going short means that you borrow the stock from your broker and sell them at the market price. So if you borrow 100 shares of XYZ and sell them at it's current market price of $30 you practically just received a $3,000 loan from your broker. Instead of owing money all you owe is 100 shares. Let's say over the next two weeks it goes your way and the price is now $25. You decide to buy back 100 shares, called buy to cover, and give them back to your broker. Out of the $3,000 that you received by selling them two weeks ago you must use $2500 of it to buy them back since it's now cheaper. Meaning you made $500 profit.

It of course is more risky. It could jump up in price and you would actually owe your broker money. So if in two weeks the price is $35 a share you would have to pay $3500 to buy them back meaning you would owe an additional $500 of your own money. It literally has unlimited risk. Investopedia stresses this point in their short selling article but what they don't seem to mention is that you can limit your risks by using stop losses. Meaning you can set it to automatically buy to cover if it goes higher than you would like.

[ohanian]

Going long means you buy a share at $1 today because you believe that it will have a value of $2 tomorrow.


Going short means you selling a share (your share) at $1 today because you believe that it will have a value of $0.50 tomorrow. Or if you are a true believer, sell your friend's share at $1 today because you believe that it will have a value of $0.50 tomorrow. The price of share had better be less than $1 tomorrow or your friend will be VERY VERY ANGRY

[Micki]

$this->bbcode_second_pass_quote('', 'W')hat I have no clue about is the type of trading you're talking about, e.g., "long", "short", funds, mining stocks, etc. I don't even know how you go about buying such a thing or keeping up with it, except for kitco.com and a few other links I've found, where they speak whatever foreign language y'all are using.

[Dukat_Reloaded]

I'm going to put a punt on for next week, I'm hardly certain of this next move, but I have a feeling these are going to drop lower again by the end of the week.

GOLD will close under $640, Copper Under $3, Silver under $11, Oil under $65.

So, how to play this, buy bullion anytime, be careful with stocks and if you really want to buy try to offer lower than the market is offering hoping it to be filled, don't do any 1:100 CFD margins on gold or something similar. This corrective cycle could last for quite along time, we underestimated the gold Bull, then we overestimated the gold bull in the last 2 weeks, do not underestimate the gold bear then overestimate it at the end. What will probably happen is everyone will underestimate it then overestimate it. To get a good time in to buy, remember gold when it hit $730 and then more than ever you wanted to buy gold, try to do the opposite of that in this bear cycle, when you feel, OMG I gota sell everything, BUY. I would not be suprised for this market to head below $600, maybe $550 before recovering.

[greenworm]

Crazy cycle. I picked a top of $750 due to the speed with which it broke $700, I knew alot of late comers were going to dive in, however, I was wrong when it began its descent from $730. I was a day late on my position, cause I knew when it was gonna pop, it was gonna pop in a big way! I am guessing a low of $600 and it will settle around $620 and hover between $610 and $650 until 2007. I just had a silly thought! Since we have every etf imaginable (oil,gold,silver, etc), why don't they have one for interest rates so we don't have to run out and get bonds Probably already exists.

[kabu]

I haven't been around for very long yet, so I don't know which analysts and advisors are credible, but what do you guys think of Bob Hoye's article on 321gold?
http://www.321gold.com/editorials/hoye/hoye051906.html

He's looking at the consolidation of gold over the month, between $630 and $660.

I liked how so many stocks went up on Friday despite bullion's additional drop in price. Isn't that an indication that the stocks were already oversold in anticipation of a more drastic rout in the metal commodities? I'd better quickly get my last paycheck into my RRSP incase things start taking a turn back up, before long.

I had a dream about copper going under $1... I woke up depressed.

[pedalling_faster]

i think of gold & silver as an anti-depressant - if you own some, when the dollar falls, usually gold & silver go up. sort of takes the sting out of watching your own national currency lose its value.

the week ending may 19, i was buying silver at a store in San Diego. i feel that the information that can be obtained in a respectful conversation with the store owners is just as or almost as valuable as the gold and silver itself.

i think gold and silver fell big-time on wednesday, then continued falling on thursday & friday. i was buying on thursday.

when i called the store, i was lined up for a 100 oz. silver bar. by the time i got to the store, prices had fallen so much that the guy didn't want to sell, because he would have lost money, understandable.

apparently there was an audit/ investigation of some of the biggest dealers in a major american city, and this made the markets nervous. spot prices fell, and the uncertainty led a lot of retail dealers to increase the spread between their buy & sell prices.

as long as the blob of protoplasm in the White House is pursuing the current fiscal policies, running up the deficit, the U.S. dollar is destined to fall in value. continuing to make precious metals a safe haven, with the caveat that the US government could seize gold bullion, which i think includes the American Eagle gold coin.

having recently worked for a major defense electronics contractor, i can say that vintage 2006 electronics uses very little gold. (compared to HP computers from, say, the mid-80's. my God, full of gold-plated circuit boards !) during World War 2, strangely, silver was diverted to coinage (nickel coins), and copper was precious (hence the steel pennies in 1943 i think).

in terms of rationale's for seizing gold, i don't think the US government could say it needs gold as a contruction material for military hardware.

i wonder what their stated reasons would be if they did seize gold.

[green_achers]

Thanks for the advice, all, esp greenworm and Marklar. Investopedia looks very promising, now to do my homework.

On the govt confiscation question, I have thought this through, and from what I've read, when gold was called in in the 30s it did not include jewelry and art. Presumably this would be the case in the future, and I have a workbench and a ball-peen hammer. I can turn any metal into art real fast.

[greenworm]

Your Welcome! I highly doubt that the gov't is gonna take your gold, they are lucky enough we let them steal our money in taxes. Guess what I have planned this weekend. I live in a somewhat mountainous area with many a river bed. I watched some treasure hunting show on the television and I am dying to try it. I won't get anything, but since I don't have much to do, I figure, what the hell, they gave certain clues concerning where to look in terms of soil color.

[greenworm]

Man, gold mining stocks are getting hammered, I should have shorted. Woulda, coulda, shoulda!

[kabu]

Dang, I wonder if Canada will follow suite tomorrow, after Victoria Day's over. New York closed with the metals a tad higher, though.

[Aimrehtopyh]

$this->bbcode_second_pass_quote('pedalling_faster', 'i') think of gold & silver as an anti-depressant...

...information that can be obtained in a respectful conversation with the store owners is just as or almost as valuable as the gold and silver itself...

in terms of rationale's for seizing gold, i don't think the US government could say it needs gold as a contruction material for military hardware...

i wonder what their stated reasons would be if they did seize gold.