Watch for falling prices.

[KMS]

Margins raised 3% in China, effective today, 20 November.

Source

How low can it go?


Also want to add that if the markets are betting for the Euro to drop and the dollar to rise that will help push prices down even more so for those buying with USD. GL!

 

[pmbug]

Look out below!

 

[pmbug]

...
Maybe even a bigger reason for gold and silver selling off is due to the CME quietly going back to full initial margin. They have returned margins to levels prior to the CME's panic MF-induced reduction. I couldn't find any notice of their decision on the CME site, but I confirmed it with my broker Rosenthal Collins. It was scaled in over 7 trading days between November 11th and November 17th. I suspect weak spec longs who took advantage of the temporary margin reduction, and not knowing when it would be reimplemented, are getting flushed. The timing for the margin hikes of course dovetails nicely with looming op. ex. and FND. It's kind of surprising that the usual sleuthing of ZH didn't catch this. Nonetheless it looks like the die is cast for gold until after next week, and maybe $1,800 will be all she wrote for 2011 if the yearly cartel percentages hold.
...

http://harveyorgan.blogspot.com/2011/11/margin-hikes-again-at-cmegold-and.html

 

[DCFusor]

You don't suppose the dollar being the best looking horse in the glue factory could have anything to do with it, do you? This chart isn't the absolute dollar value, but the "price" of gold might not be dropping as much as it seems in true value (what you can get for the gold).


I get these nice 1 yr overviews at ino.com. Free.

 

[pmbug]

According to kitco's calculations, the metals are down over and above the action in the dollar today:

http://www.kitco.com/kitco-gold-index.html

I'm expecting to see the metals get hammered today and tomorrow and then the sale ends. Maybe some crazy action happens while most people are worrying about Thanksgiving and holiday gift shopping, but my intuition says op. ex. tomorrow will be the pivot. Of course, the markets are being driven in large part by headlines from Europe, so few lay people can really know which way it's going to go.

 

[DCFusor]

Sure. There are numerous reasonable reasons for that, too. For one thing, that measure of the dollar is against other currencies, not a measure of absolute value.
There are things that affect this number that don't affect gold, and vice versa. But often they move more or less inversely when one looks at longer than day periods, or close enough for government work.

It's just another data point in the group to look at when deciding when to make a move.

 

[DSAbug]

1680 is key support.. we really need to hold there or we could see 1600 in short order.

 

[swissaustrian]

Don´t worry it´s all options expiry manipulation. We´ve seen this month after month.
Options expiry is tomorrow. The big difference between gold and silver today is the best indicator for manipulation. Silver has basicly gone nowhere since 5 am ET. Gold fell 30 bucks since then.

 

[DSAbug]

Opx or not, this is severe technical damage. The miners are in even worse shape. 1640/1650 is it before go back to previous lows. That is very bad

 

[swissaustrian]

Opx or not, this is severe technical damage. The miners are in even worse shape. 1640/1650 is it before go back to previous lows. That is very bad

You may be right, but I don´t really care. I always hedge my physical positions 100% before options expiry and then sell my shorts right after it to buy more physical. This is free money given to me by the tbtfb. Just take it and get some more oz. It didn´t work every time (I´ve done this since 2007), but overall I´ve made about a 40 % outperformance to spot gold meaning I could enhance my physical position by 40 % thanks to opx manipulation.
In terms of the miners, it´s a 2008 like buying opportunity imho. Many of them are selling for less then a PE of 10 assuming gold at ~ $ 1600. What a gift.

 

[pmbug]

I was expecting a big sale before Christmas. This might be it. Or the paper markets might completely implode with Euro debt dominoes, US debt rating downgrade (supercommittee fail), etc. I'm looking for a good opportunity to buy physical.

 

[DoChenRollingBearing]

Great thread!

I too will look upon any further declines as an opportunity to buy more physical gold.

As I rant over there at ZH from time to time:

NONE of our financial problems have been solved! Or even addressed...

NO ONE of any significance has gone to jail!

---

So the US$ maybe gets a bounce as money flees Europe. My guess is that Europe falls first, as they have so many actors with agendas and all of that is so obscure. No transparency. Languages. Muslims...

But, the chickens WILL come home to roost here. The SuperDuperCommittee just demonstrated yet again that our political elite have NO INTENTION of cutting spending, the heart of our financial problems (IMO). Looks like France gets a downgrade soon. Then us. Again

 

[DosZap]

Bug,
I agree, I think the Expiry, and the Europia Mess has folks spooked, and on the sidelines.

If they crash the Euro,then Pm's hit the elevator,and we could see $700.00 again.If they print, and /or separate(get rid of the bad actors) and make the EU more viable, it goes the other way.

Pm's UP,USD down.

And,as DoChen states, the EU mess has just taken the worlds eyes
off of US, for the time being.

 

[mmerlinn]

The Euro cannot continue to exist as a common currency unless there is a CENTRAL taxing authority and a CENTRAL currency administration. Currently, there is no central authority to ensure stability of the Euro. What is currently happening is that there are 15 countries with 15 different sets of laws and 15 different sets of standards trying to make the Euro work. The Euro was doomed from the beginning.

That means that UNTIL Germany (the only country able) becomes the central taxing authority, the central currency administrator, and the master of the rest of Europe, this EU mess will not be solved.

When? Not yet. The other countries in Europe are not all ready to give up their sovereignty. Once they give up their sovereignty to Germany, then the current EU problems will be resolved and the mess will move to the U.S., U.K., and other nations bent on trashing their currencies. My guess would be sometime after Easter next year maybe around the end of June or so.

Short term, we could see stabilization and/or deteriation of Gold and Silver based on USD. Long term, the sky is the limit.

 

[Steven Douglas]

There will never come a point where I am not thoroughly dumbfounded that the Euro experiment was even tried. I can ALMOST see how the Fed got established, but the Euro? Nobody owes anybody anything? All countries jointly and severally liable with each other?

I can't say that I'm gobsmacked, because that would imply that I hit my mouth so hard that my entire face disintegrated.

 

[DSAbug]

Bug,
I agree, I think the Expiry, and the Europia Mess has folks spooked, and on the sidelines.

If they crash the Euro,then Pm's hit the elevator,and we could see $700.00 again.If they print, and /or separate(get rid of the bad actors) and make the EU more viable, it goes the other way.

Pm's UP,USD down.

And,as DoChen states, the EU mess has just taken the worlds eyes
off of US, for the time being.

The largest runs the PMs have ever had were when the dollar was strong. The USD/Euro/Yen trades are not as correlated as we are commonly lead to believe.

 

[DosZap]

I have a contrarian view as I see it as good.
The more they can manipulate it, and drag it down, the MORE we can snag.
We all know the day of reckoning is ahead.I want my CB to be as low as possible, and have as many ounces as possible.(I know you all feel the same way).

 

[DosZap]

I agree IF the PM's decouple from the USD.(they should have already IMHO)

 

[DCFusor]

As always, sit on the phyzz, and trailing stops on everything else! The only thing that would surprise me is calm at this point, but I get surprised often enough...

I've gotten up some decent dry powder, and it might be time soon to add substantial to my physical...house money gotten from trading the paper (and short market and euro, nice trades while they lasted, now mostly closed).

I do suspect some of this is going to take, errrmm, large intestinal fortitude.

 

[pmbug]

Not gonna lie - I decided that black Friday (Saturday actually) should have silver lining to it. Just a little though. Still holding out some dry powder for a big opportunity.