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Hammer Time...Ba-Ba-Ba-Dump....
Imagine my disdain driving into work this morning and hearing gold was down $6. Now imagine how pleased I was to hear, literally just ten minutes later, that gold was down $13 because the BOE and ECB left rates unchanged. I figured it had to go down sometime.
When I got to work and fired up my computer I saw gold attempt a feeble rally to down about $8. But this being gold, I figured we would soon be at the days low. And sure as sh$t, I was right. Gold took out the previous low of being down $15, and pretty much plummeted through the day, closing down $30 and the HUI also crashed down $38. Silver wasn't much better closing down more than $1.50, at $14.23. Shades of May 2006 rang through my head as I seriously contemplated selling anything and everything gold. When this type of crap happens, I get fed up with gold. I lost a bundle today. All this happened in the face of a strong stock market.
As early as three weeks ago, that would have been the beginning of my post, except with a lot more cursing. But as I have been saying this is not your father's gold. Hell, this isn't even my gold. I don't recognize this strong beast.
When I got to work, gold was down $11; I figured it had attached itself to crude which was down $1.50 even though the dollar was flat. However, I did notice it trying to come back. Now, I have seen this movie many times before. Gold is down a bunch, tries to rally, gives me a headache and then falls into the pit of Zool(copyright owned by Brian Pascal). But, lo and behold, all of a sudden, gold was down, $8, now down $6, now down $4, oh shit, now down $7, crap gonna be a long day. Whoa, down $4, down $3, down $1. Holy $$#*@, its GREEN!!! OH MY F"ING GOD, I HAVE NEVER SEEN GOLD DO THIS!!!!!!!!!!!"
The turnaround was primarily because ECB President Trichet was relatively hawkish on rates. That sent the dollar lower vs the Euro and gold higher even though oil was now down $2+.
Gold meandered around from up $2 to up $6 until around noonish when Helicopter Ben told the markets, "Don't worry, I got your backs--they don't call me Helicopter Ben for nothing!" That ignited a spark into gold and up it went. It looked like for a second, that once it breached the $894 high of a couple of nights ago, it might hit $900! ($900! Who woulda thunk it). I was waiting with buy baskets lined up for my favorite gold stocks if gold went past $902ish, as I felt a strong breach of $900 would send the gold stocks up through the next level.
In all it was a great day for gold, closing up $12 and the HUI up $10+ (knocked down from $16). Gold was it's own man today, trading higher in the face of weaker oil. It was correlated with the falling dollar. The gold stocks were actually correlated with gold. In essence, everything that was supposed to happened, did. Next thing you know, dogs will be chasing cats, and men and women will be living in harmony.
Hmm...gold having a mind of it's own, I kinda like that. I need to remember these good times, for at some point, there is going to be a hammer time, just hopefully not tomorrow, as I am very long gold stocks.
Two things I want bring up quickly: 1. I only caught the first half hour of Fast Money and did not hear a word regarding gold. However my boy, Guy Adami did recommend NILE, a stock selling at a 66PE. 2. During the day, the geniuses over at Merrill Lynch downgraded AEM on a valuation call. In their models they used to generate this flash of brilliance, the figured AEM's numbers on gold being at an average price of $750 in 2010. Look for separate columns on both of these items, including comments from the MER analyst.
When I got to work and fired up my computer I saw gold attempt a feeble rally to down about $8. But this being gold, I figured we would soon be at the days low. And sure as sh$t, I was right. Gold took out the previous low of being down $15, and pretty much plummeted through the day, closing down $30 and the HUI also crashed down $38. Silver wasn't much better closing down more than $1.50, at $14.23. Shades of May 2006 rang through my head as I seriously contemplated selling anything and everything gold. When this type of crap happens, I get fed up with gold. I lost a bundle today. All this happened in the face of a strong stock market.
As early as three weeks ago, that would have been the beginning of my post, except with a lot more cursing. But as I have been saying this is not your father's gold. Hell, this isn't even my gold. I don't recognize this strong beast.
When I got to work, gold was down $11; I figured it had attached itself to crude which was down $1.50 even though the dollar was flat. However, I did notice it trying to come back. Now, I have seen this movie many times before. Gold is down a bunch, tries to rally, gives me a headache and then falls into the pit of Zool(copyright owned by Brian Pascal). But, lo and behold, all of a sudden, gold was down, $8, now down $6, now down $4, oh shit, now down $7, crap gonna be a long day. Whoa, down $4, down $3, down $1. Holy $$#*@, its GREEN!!! OH MY F"ING GOD, I HAVE NEVER SEEN GOLD DO THIS!!!!!!!!!!!"
The turnaround was primarily because ECB President Trichet was relatively hawkish on rates. That sent the dollar lower vs the Euro and gold higher even though oil was now down $2+.
Gold meandered around from up $2 to up $6 until around noonish when Helicopter Ben told the markets, "Don't worry, I got your backs--they don't call me Helicopter Ben for nothing!" That ignited a spark into gold and up it went. It looked like for a second, that once it breached the $894 high of a couple of nights ago, it might hit $900! ($900! Who woulda thunk it). I was waiting with buy baskets lined up for my favorite gold stocks if gold went past $902ish, as I felt a strong breach of $900 would send the gold stocks up through the next level.
In all it was a great day for gold, closing up $12 and the HUI up $10+ (knocked down from $16). Gold was it's own man today, trading higher in the face of weaker oil. It was correlated with the falling dollar. The gold stocks were actually correlated with gold. In essence, everything that was supposed to happened, did. Next thing you know, dogs will be chasing cats, and men and women will be living in harmony.
Hmm...gold having a mind of it's own, I kinda like that. I need to remember these good times, for at some point, there is going to be a hammer time, just hopefully not tomorrow, as I am very long gold stocks.
Two things I want bring up quickly: 1. I only caught the first half hour of Fast Money and did not hear a word regarding gold. However my boy, Guy Adami did recommend NILE, a stock selling at a 66PE. 2. During the day, the geniuses over at Merrill Lynch downgraded AEM on a valuation call. In their models they used to generate this flash of brilliance, the figured AEM's numbers on gold being at an average price of $750 in 2010. Look for separate columns on both of these items, including comments from the MER analyst.
posted by Neal | 10:44 PM
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