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Placer Dome Inc. (PDG) Message Board

  • juryman07 juryman07 Jan 26, 2004 1:59 PM Flag

    Why has PDG broken support levels?

    Who's selling? Dollar's weakenss has not changed? Why are gold stocks as a whole very weak again today? Any ideas...

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    • I bought gold in 1972, both gold coins and shares.On dips i bought more. I held until 1979-80, when TV and radio talk all recommended to buy. Gold has value primarily when it is bought as a currency. I started buying gold again when it got to 275 (in '99) and have bought since. I just bought some at 407. I bought PDG at about 7.50. I still have it and the bullion coins.
      If you look at the 30 year chart on bullion you'll notice that gold nearly always goes up in the fall, and declines from January to late March-April.
      If one understands that gold is being bought again as a currency-to preserve the value of money-then one can ride out the coster-effect.
      I bought in the 70's because of the debauching of our currency. I am buying again at this time because the same conditions are back, except this time -with floting fiats of all moneys- the sitution is much more serious. I expect to look at shares again from April to August and add the stronger ones.
      My wife wanted me to sell at PDG at 19.00, but I'm going to hold until the Fed's actions are being strongly reversed.
      Our money is being seriously devalued, and I think it will continue until some resolve is made INTERNATIONALLY to have a single currency to stabilize world trade. In the 70's it was a roller-coster, but the ISSUE was the devaluing of the currency.
      When gold transfers its value from a commodity to a currency, its value is related to and determined by the Fed Banks of the Nations, esp the U S Fed.
      Also when gold assumes the market structure of money, ALL commodities and "things" rise in apparent value. This was true in the 70's, and is also true today. Until the CBs change their attitudes, we are in for a ride. I'm just going to hold until it is resolved.

    • No to be too picky, but a close of 15.90 is not a "confirmed" break of support at 16. You've got to be 3% below support. Notice that we had a nice bounce at the end of the market. On the other hand, assuming this is a genuine break, we'll likely retreat into the upper 14s short term. Anyone holding this stock long- or medium-term probably shouldn't sell into this and risk losing their position. Pessimists may consider a pullback to the 200-day MA not out of the question, but I doubt that will happen without some change in fundamental conditions. IMHO.

    • violence_begets_more_violence violence_begets_more_violence Jan 26, 2004 3:59 PM Flag

      I think the stock rose too much, too fast.
      In any case, here is a chart showing excellent
      BUY and SELL signals:

    • Why has PDG broken support levels?I think it is because of pessimism and fear among investors #####February gold fell $1.30 to close at $406.70 - its lowest closing level since Dec. 11 with traders betting that world officials will soon move to stem the U.S. dollar's decline -- thus easing some of the precious metals' investment value. More.... Several long-term gold bulls have been warning that bullion, and even more so the stocks, are overbought short-tem.
      "This is the correction I've been talking about," wrote Dow Theory Letters' Richard Russell this weekend. He added:
      "It's been offset by the upside correction in the dollar. The gold bull market is taking a rest as gold and gold shares continue to move into stronger hands."
      Gold has been climbing a wall of worry. And that has resulted in more worry.
      However, in contrast to the gold timers overall, the gold geezers my name for the gold timers who were around during the last gold blow-off in 1980 are exactly where they were when I last looked . All are long-term bullish except Elliott Wave guru Bob Prechter.
      Precisely what the most grizzled gold bugs mean by long-term (and just why less hardened investors might worried) was made clear by the International Harry Schultz Letter's Harry Schultz in a recent powerful talk to a conference in Munich, Germany.
      Schultz noted that he's been trading gold since he lived in Shanghai in 1945-6. ("That's 57 years of gold trading!")
      Schultz ringingly reaffirmed his faith in the new gold bull market:"Exactly how high the gold price will go is obviously uncertain but surely it will be $500 or 600 or 700 or perhaps much more, over the next few years."There is, however, a catch a big catch. Schultz warned, in his idiosyncratic Schultzspeak:"But corrections in the gold mkt are always vicious. I am a veteran of the 1970's gold mkt & they called me a gold guru then. We saw a 50% correction in bullion in the middle of that gold bull mkt, from approximately $400 to aprox $200, which meant that due to leverage in the shares, the shares fell 70% or 80% or even 90%."
      Arrgh. And, just in case anyone missed the point, Shultz rammed it home:"U can be sure that there will be another 50% gold correction with an 80% drop in share prices."Aaargh again! This obviously goes far beyond the normal definition of a bull market correction. All that can be said in its favor is that it worked before.Is it happening again? Schultz hasn't quite said that, although he was one of the letters warning of an imminent correction.
      Schultz's suggested strategy: hold a core portfolio of gold bullion or coins and trade the shares. Buy low, sell high. That sort of thing.Unfortunately, Mark Hulbert's monitoring of Schultz provides no definite proof that he can really trade this volatile market successfully. He has made striking calls: He did bale out of gold after it peaked in 1980, but is often too obscure to permit the construction of a model portfolio.
      In contrast, Dow Theory Letters' Richard Russell, very similar in background, experience and gold buggishness, eschews trading and advocates buying and holding gold shares.More...