Gold Bulls' 2010 GamePlan
1. Hi Ho, Hi Ho, it's to the inferno the paperbugs now go.
2. Gold kicked off the first day of trading in 2010 by taking the gold shorty pants to the cleaners. Then the woodshed. The COT report released yesterday showed the fundsters dumping another 8000 gold longs into weakness in failure, while the banksters booked profit on about the same number of their shorts.
3. Meantime, over in the "the big leagues," the US dollar market, this market is where the trillionaire monsters make their money from gold's price action. In the final analysis, Gold controls the US dollar, not the other way around. But the gold market is too small for the banksters' monster money to move around in size, without causing mindblowing volatility. So shorting the USD is their hallmark play, and there has been a huge rise in bankster short USD positions into this piddly USD strength. Here's the USD chart. USD Daily Chart. The Technical Indicators all are rolling into sell signals.
4. Meantime, most of the supposed leaders of the gold community and fundster communities have engaged in a maniacal price chasing race. To see who can throw their gold in the garbage the fastest on weakness. As the gold traitors load up on USD toilet paper just in time for the end of the 30 year bull market in bonds, the banksters are taking the other side of the trade. Nice work guys.
5. The worst traders in the gold community, but with the largest mouthpieces, have of course stepped forward to "analyse" the situation for you. Theories from "it's all algo trading" to "my cycle chart painted by the banksters' two-year old kids says gold will crash any day now" are some examples of their master analysis. These people are all gold bears, many wearing bull masks. They get off on seeing you liquidate your gold in total failure, just as they have.
6. The reality for you as an investor is that the banksters are shorting the US buck in size, exactly as I said they would into this usd micro-rally, as the fundsters bust out of the carry trade. Trader Dan Norcini, perhaps the greatest chartist in the entire gold community, posted a superb chart depicting this reality on Jim Sinclair's website yesterday at www.jsmineset.com. [pdf]
7. The fundsters have been price-chasing the US buck higher like there is no tomorrow in record size, while bailing on their failed shorts, and the banksters are taking every failed and bailed position from the fundsters. Already, the phrase "carry trade" has virtually disappeared from the media, like it's over. It is over. For the fundsters, and for many in the gold community.
8. For the banksters, and for those of you in the gold community that are not gold traitors, here's a reality check: the USD bear market is not over. It's accelerating. The fundamental rot is growing daily, and doing so exponentially. It is not improving. The banksters don't play for peanuts and they don't book losses. They book profits. Massive ones. They aren't shorting the USD to lose and they will not lose. Which side of the trade are you on? Question: If YOU are buying the USD here and now, how do you feel knowing it is the banksters holding the entire other side of your trade? Good luck to ya taking down the banksters by going long USD toilet paper as Morgan Stanley puts a whale harpoon in the US bond bull. The bond bull is dead. The banksters know it. Because they killed it. While the short term charts are drastically oversold, the bond bull is all over in my view. It's finished.
9. Charts can be painted. By the banksters. And no chart is easier to paint than the gold chart. Because price is determined mainly on the comex, where it takes very little money to move price. The banksters' motto is: New York sets the price, and London trades the volume. Those drawing squiggly wiggly bear market lines on the gold chart are taking on Asia's central banks. You can bet your hard-earned money (soon to get much harder to earn) in size on Ben Bernanke's magical printing press if you like, while he bets against you himself, but I'll bet mine on gold.
10. I'll give you 1% odds that the banksters' USD shorts are sold at losses. And 99% odds that the gold and fund community's current lunatic price-chased long USD positions will be sold in total failure. The USD bulls are lined up directly against Paul Tudor, John Paulson, Bill Gross, Warren Buffett, the Central Banksters of Asia, and for that matter, the central banksters of the Western World including Ben Bernanke himself. Who, exactly, is leading the bulls? Oh, yeah, there they are: some overleveraged forex traders holding 2 mini usd/euro contracts and shorting gold booking $100 a trade wins. All hail the USD bull leaders! Maybe you can send them a donation to meet their current $2000 margin calls while they hide under their desks crying this morning as gold soars higher. Again.
11. Most of the usd bulls are on leverage supplied to them by the banksters. Calling the current situation a USD bull fish in the barrel shotgun party with the banksters holding the guns, is an understatement. Yet there all the morons are, throwing their gold away in a literal race to the gold garbage can. To repeat, because we only learn by repetition: My message to the Gman cheerleaders known as USD bulls: Good Luck to ya in your battle against the banksters and the Asian central banksters. You won't just lose. Your final resting place will be the bread line. Where your only investment choice is going to be white or brown bread crusts. Maybe your online forex dealer will leverage that for ya. You've made your bed of used bankster USD toilet paper. Now the banksters are going to make you lie in it. You've been told.
12. I also told you: 2010 is the year gold goes on the offence. No more defence. No more "answering" to the bears. Gold IS on the offence. I'm just going with the flow. Are you?
13. I also told you 1075 felt like 905. For those of you that have "forgotten," 905 was the last point where the gold and fund communities marched to the gold garbage can and threw everything they could in there as fast as possible. And I alone stood screaming on the gold sites, "buy". We all know who won that fight. I did. And I just won the 1075 fight the same way. The big winners of course were the banksters, as it was them who took the biggest side of that entire long gold trade. Now here we are at 1126 as I write this, with gold skyrocketing up $50 from that point of capitulation at 1075. I don't need any chart to identify an exact bottom in gold. I just need to look inside goldland's mind. I heard the moans of pain at 1075, and felt the "sell it all at the market" buttons being pushed as they busted out en masse and marched lemming-style into the USD. I'm not a rat, so I won't mention any names. They know who they are and know full well what they did.
14. Anyone with an economics degree can put on a market show. Hundreds of thousands of advisors around the world are experts in this regard. They put on their bullcrap seminar and all the idiot price chasers stand around and clap while the trading bustout spews his economics drivel. When they actually have to invest your money, not just blab about how "respected" and smart they are, what happens? They blow you up. The current scheme of packing your money into price-chased junk bonds and USD wallpaper is front and centre in seminarland. Residential real estate recovery will soon also get star billing there. Get in on the new real estate boom, financed by repossessed credit cards and cash from all your gold rings sold to the pawnbroker at a 40 percent markdown. Sounds solid. Almost as solid as a lotto ticket. Almost. Don't forget to leverage it 100 to 1.
15. Making money in markets and charting and analysing them fundamentally, are two totally different and often unrelated realities. I'm about making money. Like a street fighter. If it doesn't work consistently to make you money, I throw that tool, or that analyst, in the garbage. Not gold. If you can't trade, do yourself a favour and follow Richard Russell's advice: Don't sell your gold. Don't play analyst. You'll come out on top of all the golf ball advisors and economists who have a little bit of knowledge... knowledge that is good for nothing in the trading nor the long term investing arenas. A little bit of knowledge is a dangerous thing. I would argue it actually defines the term "lifetime market loser".
16. Let's take a look at the charts. And see what further pain is coming to the USD bulls. It is huge. Here's the daily chart for gold; Gold Daily Chart. Notice the position of the 20,12,7 series stochastics indicator. It is the most oversold since July. The MACD is at the most oversold since April when gold hit 860, another point of massive capitulation and failure for the gold and fund communities. In fact, the 20,12,7 series of Stochastic is at the most oversold level since before the lows at $680 in Oct 2008! Right now as I write this! Here's a look at a two year daily chart where you can see this in neon. Do not listen to the gold bears. They are market losers who have failed for 10 years in a row, and they want to drag you down into the pit of failure to burn with them. Gold 2 yr daily chart.
17. Gold's immediate price continues to be "ruled" by the massive head and shoulders pattern on the weekly chart, and by the epic head and shoulders on the inflation-adjusted chart. That is the gold technical story. The bears are a clown act. My trading guru "The Brain" had this to say about the bears while taking delivery of some of his Comex gold futures last week: "Get a couple of acres of land... let them bury themselves 6 feet under... yes it's cold down there, but at least they won't have to worry about the gold price anymore" -Trading Superstar, The Brain. Dec 2009.
18. The Brain has caught the gold vibe: No more answering to the gold bears. They answer to Gold now. From their knees. They better get used to that position. Because they are going to be there for a long, long time. For those who think I'm too aggressive in my gold offence stance, when President Roosevelt stole your family gold and handed it to the central banksters, then revalued it 70% higher for themselves while devaluing all your money by 40%, then banned all audits of their actions, have you forgotten about that, about what these scumbags did to your own family?
19. The Gman made the fight personal. Not gold. Are you on the gold offensive team? Or on your knees with the paperbugs, taking on the central banksters, taking on a battalion of gold steamrollers while clutching your ridiculous gold bear cycle charts? The gold bear guru of Elliott Wave has totally failed you in the gold market. The gold bear cycle gurus will suffer the same fate, at the hands of the banksters' kiddies working as chart painters.
20. It's time to Get Real. Get back on the gold bull or get trampled by him. The choice is yours. Party time versus financial death. I've chosen party time. Gold Party Time.
21. Here's the chart of the bond market. I wouldn't invest one cent in this putrid thing at these price levels. Bond Market Burnt Toast.
22. If the banksters pulled another Lehman and tanked a major bank, the entire global financial system would close. It came within hours of closing went they turfed Lehman. The financial system now is like an amateur boxer that stepped into the gold ring with Muhammad Ali for 12 rounds of beating. The next punch kills them. Unlimited money printing is what is coming now. Not defaults and bankruptcies. The banksters aren't short the USD in size because they are planning to send the public into the US dollar. They are planning a hit on the thing. And it will go down as just another loss in a lifetime of failed trades for the gold bears.
23. Here's a piece of the Morgan Stanley analysis where they speak of "sovereign risk" as a key theme of 2010. What is sovereign risk? In plain English, that is a bear market in federal govt bonds.
All-out default by the US Govt is not an option. Why? Because it doesn't make the banksters' current market positions any money, the answer is that simple. Too simple for the stupid gold bears to grasp, bears who are obsessed with taking the other side of the banksters' trades, as they have been doing for 200 years. 200 years of total failure. There won't be any govt default. What there will be is money printing of any and all amounts required to buy the govt's own bonds with it's own printed money. The banksters have buried the real losses of the OTC derivatives losses with their fake mark to model accounting. So there can't be any more deflationary surprises for now.
24. All there can be is higher, higher, and higher gold prices and lower, lower, and lower US dollar prices.
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Stewart Thomson is a retired Merrill Lynch broker. Stewart writes the Graceland Updates daily between 4am-7am. They are sent out around 8am. The newsletter is attractively priced and the format is a unique numbered point form; giving clarity to each point and saving valuable reading time.
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