ok just some random thoughts. today seems to be one of those smackdowns by the high frequency trading computers to keep the sentiment for the mining index in check. just about every trade is in four decimals which is usually a sign of computer trading. gold and silver rallied on the bernanke testimony that he believes his money printing is working and should continue the policy. that brought silver back above 29 and gold back above 1600. yet it seems the computers won't let it run, just about all mining stocks are flat to either slightly down or slightly up. the motive for this is unknown. Logic says if the spot price rises that is good for the mining companies and thus the stock price should rise and vice versa. I know there are other factors involved but overall that logic should work as well as when a company grows it's resources. except that logic rarely works in the real world of trading as many miners are just grouped together as one, some anomaly's here and there but overall they move together. But why the negative sentiment on miners? A lot of people say that spot prices are manipulated and there are always those that say that it isn't. it should be fairly obvious that it is. at a time when fundamentals for gold and silver couldn't be greater, the physical demand is at it's highest and supply is tight the law of supply and demand would indicate prices would be at a peak as well. there is a disconnect from the supply and the demand for the metals. the spot prices have went against the law of supply and demand because there is an abundance of paper and a shortage of physical. so the answer for the manipulators who have leveraged their physical holdings is to sell massive paper positions destroying the value of the physical along with it. They do this with the hopes the physical holders will sell their contracts and the manipulators won't have to make good on their physical delivery. JPM and the Comex no doubt have a very close working relationship and each have a vested interest in helping each other out. the government is aware of this you can be sure but it is in their benefit as well for low spot prices, not only so they can buy physical cheaper but also low spot prices generally mean a stronger dollar, a win win for the government so why blow the whistle? Most of the miners rallied off their 52 week lows and another gap up would have many calling a bottom in the mining index as well as charts would indicate a bottom. I guess that's why there is resistance here at this level, somebody doesn't want the status quo to change so instead of a gap up we have to settle for some sideways consolidation. the downtrend may finally be over for gold and silver and thus now is the time to buy the miners. EXK is easily the best buy in this space. I also am watching SVLC just looking at it's stats it's value is cheaper than exk but i don't know much about them and volume is a lot lower. for gold miners I don't see any clear multibaggers except for NUGT. I went long NUGT at 5.71.
Sentiment: Strong Buy
you could sorta tell yesterday that silver was going to be driven down again today
just by looking at EXK traded,
no surprise, it's that time of the month
the end of the month
they hate gold and silver
they can't snap their fingers and create silver,
but they can force the price of it down.
Oh well, they can play their desperate games.
I'm not going to sit here and complain that the system isn't collapsing fast enough...
man it is annoying to post in that tiny little box
they want to limit us to small-time stuff, like tweets
it's yahoo twitter envy, and they take it out on us,
the most loyal of their users
why can't they ever do anything right?
Sentiment: Strong Buy
JPM, CITI, BAC, GS, The President's Working Group on Financial Markets (aka the punge protection team), the SEC and Crimex...all in collusion to name a few. They can get "things" done. That is for sure! GLTU
You made a good point. It seems to be confirmed by Henk Krasenberg, founder of the European Gold Centre, in a recent interview by The Gold Report (TGR).
TGR: Germany recently announced that it wanted to repatriate part of the gold that it has in foreign banks. What did you make of that announcement and that it's not going to fully happen until 2020?
HK: I'm puzzled that not more people are concerned about this because most of the foreign gold is with the Federal Reserve in New York. First there was a 30-year deal, and now it is to take them seven years to deliver that gold to Germany. That scares me because what does that mean? Is the gold not there, as some people believe? But the seven-year stretch most probably suggests or indicates that they used the gold, which was deposited by the central banks, to lend it out and/or to secure loans. Some people say gold is the only asset without a liability. True, if you buy gold with your own money, but not with a loan. If it indeed turns out that the Fed has put all kinds of obligations on the foreign gold, we have a serious problem. If this scenario is true, the Fed has every reason not to let the gold price move up to over $2,000/oz because sooner or later it has to cover its possible shortfall.
TGR: What about some of the recent rhetoric from Mario Draghi, the head of the European Central Bank?
HK: People like him cannot say what they think. They are in a political function. They have a responsibility toward the nations, to the public. They have to lie, to put it bluntly, and they do. They will never say they don't have the gold or they don't have enough gold or they used it. If it ever comes out that not all the gold is where we think it is, we could see crazy days with gold prices of $10,000/oz, $20,000/oz or whatever.
TGR: What are you seeing for a trading range for gold in 2013?
HK: I'm confident that we will see higher prices. It does not take that much to get it over $1,700/oz, although what happened in the last two weeks with the gold price may make us wonder. But if you ask me whether it will be $2,000/oz, $3,000/oz or $5,000/oz, that will largely depend on the situations that arise. There are enough ghosts in the closet.
TGR: Gold went up 6.2% in 2012. Do you think it will beat that percentage in 2013?
HK: It doesn't take much to beat that.
The only firms trading EXK that use Algorithms are Credit First Boston, and Piper Jaffrey. They use algorithms to quickly find the best prices to buy or sell on behalf of their clients, such as money managers or mutual funds. Since both of these firms are holders of EXK, they will lend their shares to others in (exchange for another issue) and then trade the borrowed shares of EXK for them. The
decimal system makes it easier, but their algorithms consist of trading on uneven share numbers as the market markers need to trade inventory quick when this is happening as sells are placed on the ask. I didn't see any signs of this happening today. We had some investors and a few small hedge funds just taking some profit from Friday. Actually it was mostly retail investors.