Goldman Sachs says the top is in; Sinclair says they are about to go long

[pmbug]

I promised you that the manipulators would shift to the long side of gold before the final parabolic move.

I imagine that Goldman has a huge buy order for special clients, that is themselves.

When was the last time Goldman Sachs did the world of investment and investors a good turn?
...

http://www.jsmineset.com/2012/12/05/in-the-news-today-1389/

Anyone here not know about Goldman Sachs being a contrarian indicator? They are the classic example of do what I say, not what I do (for their own benefit to the detriment of their clients and the public).

 

[pmbug]

Trader Dan expounds on the issue a bit more:

In an odd piece of news today, Dow Jones is reporting that Goldman Sachs has issued a report stating that gold is "near an inflection point" which is likely to come next year and is "pointed lower after".

I find it odd because the reason that Goldman states this is because it expects an improved US economy that will supposedly blunt safe-haven demand for the metal based on its assumption that REAL interest rates will rise.

It's twelve month forecast for the price of gold is cut to $1800 with its 2014 view of $1750. That is hardly a big letdown but still it begs the question - Is this the same Goldman that just last week issued a report predicting that the Federal Reserve will be forced to implement QE4 at this month's FOMC meeting? You might recall that in that report Goldman predicted a $45 billion/month Treasury buying program to be announced by the Fed based on the fact that the US economy was still sluggish and that growth was lagging. This is of course in addition to the already announced and implemented $40 billion/month of MBS paper by the Fed.

Additionally, in that same report Goldman stated that this bond buying program would continue all the way through 2103. In the year 2014, economic conditions would improve enough that the Fed could ramp down the combined QE3 and QE4 programs to $50 billion/month which would continue into the early part of 2015. They also stated that they believed the Fed would not raise interest rates until 2016.

So which report are we to believe? Where is the rise in REAL interest rates supposed to be coming from? Is it from the Fed which they just last week predicted would not raise rates until 2016? Is it from the Fed which is expressly focusing on keeping LONG TERM interest rates low by embarking on another round of QE for the next 2 1/2 years?
...

http://traderdannorcini.blogspot.com/2012/12/goldman-sachs-right-hand-does-not-know.html

:rotflmbo:

 

[benjamen]

http://finance.yahoo.com/news/pros-slam-goldman-sachs-bearish-190821876.html

It seems a lot of people are doubting Goldman Sachs on this call...

 

[pmbug]

Goldman is now telling folks to short (paper) gold:

... Given the negative view that Goldman is taking of gold, the bank now suggests shorting the commodity. ...

In the current round of price reductions, Goldman lowered its average price per ounce outlook for 2013 from $1,610 to $1,545. The investment bank now sees the price contracting to $1,350 in 2014, which is a significant reduction from the $1,490 price target it once held. ...

One of the potential catalysts for the above-mentioned increased decline is an accelerating deterioration in investor confidence. A great number of gold investors piled into the commodity on a speculative basis to not miss the expected move. As prices continue to stagnate and fall, investor capital is likely to look for greener pastures more and more quickly. As speculative positions are unwound and more stop-losses at triggered, the move lower could be sharp.
...

http://www.fool.com/investing/gener...ds-top-bank-tells-investors-to-shun-gold.aspx

How does that fit with the open interest reports?

 

[swissaustrian]

Doing god's work:

Reports suggest that a 4 million ounce (124.4 tonnes) sell-order, worth $6 billion (Dh22 billion) at current prices, by a large investment bank spooked the markets and led to this decline.

“It appears that the significant selling pressure last Friday was amplified by a four million ounces (124.4 tons of gold) selling order, to be executed on Comex opening. This was clearly too much for a relatively empty market to handle, and the initial pressure resulted into waves of selling, which in turn attracted further selling all the way down,” Gerhard Schubert, Head of Precious Metals at Dubai-based Emirates NBD, wrote in his weekly report.

http://www.emirates247.com/markets/...ets-gold-price-for-plunge-2013-04-14-1.502385

I bet it was Goldman. The strategy they employed is called stop hunting and it is illegal:

Definition of 'Stop Hunting'
A strategy that attempts to force some market participants out of their positions by driving the price of an asset to a level where many individuals have chosen to set their stop-loss orders. The triggering of many stop losses generally leads to high volatility and can present a unique opportunity for investors who seek to trade in this environment.

Investopedia Says
Investopedia explains 'Stop Hunting'
Understanding that the price of an asset can experience sharp moves when many stop losses are triggered can be useful when seeking potential trading opportunities. For example, assume that ABC Company's stock is trading at $50.36 and looks as though it may be heading lower. It is possible that many traders will place their stop losses just below $50, at $49.99, so that they can still hold onto the shares and benefit from an upward move while also limiting the downside. If the price falls below $50, traders expect a flood of sell orders as many stop losses are triggered. This will then will push the price lower and give some traders the opportunity to profit from the decline.

http://www.investopedia.com/terms/s/stophunting.asp

 

[pmbug]

...
I bet it was Goldman. ...

Me too. But I also bet we (ie. the public) will never get any confirmation either.

SEC and CFTC says what?!?

 

[pmbug]

...
I bet it was Goldman. The strategy they employed is called stop hunting and it is illegal: ...

... the initial selling, rumoured to have been routed through Merrill Lynch's floor team, ...

http://www.zerohedge.com/news/2013-04-15/gold-crush-started-400-ton-friday-forced-sale-comex

Clever chaps.

 

[swissaustrian]

Imagine they had bought 4moz in one order. There would be a fierce investigation into the market manipulating behavior of the traders that did this.

 

[bushi]

...just a quick thought - for a large player (ie Goldman), as I understand it, they act both as a broker house, AND a player, yes? Therefore, they might simply KNOW the stops positions of their customers (it is all in their own systems), thus making "stop hunting" so much easier for them to implement (I mean, they will have IN THEIR IT SYSTEMS, statistically significant amount of information, as to what level of stops their clients have put in).

 

[swissaustrian]

Yes they know the stops of their clients. Their prop desk is probably not allowed to look into that data officially, but that doesn't mean anything on Wall Street. The two largest players in precious metals are JPM and HSBC. They basicly are the market. The positioning data that they can collect from clients is literally worth gold.

 

[pmbug]

It appears Goldman (together with virtually everyone else focused on physical not paper gold) has bought enough gold from its clients. Now, there is only upside.

Goldie on gold:

We closed our short trading recommendation on gold

We have closed our recommendation to short COMEX Gold, as prices moved above the stop at $1,400/toz. We have exited the trade significantly below our original target of $1,450/toz, for a potential gain of 10.4%. ...

...

http://www.zerohedge.com/news/2013-04-23/goldman-closes-gold-short

 

[ancona]

So......what's a muppet to do here?

Phyz boyz 'n gurlz.......phyz. Get all you can while you still can. Apmex and NWT have some and so does Bullion Direct. Hans appears to have a little bit, but it appears that all of the main sellers are having a problem sourcing metal.