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LunarEclipse
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Registered: 10/31/04
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Technical Analysis and Trading of Precious Metals
#21862928 - 06/27/15 07:30 AM (8 years, 7 months ago) |
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This thread is about charting and technical analysis, with a little mention of the fundamentals thrown in. Prices will be quoted in USD and analysis of the USD will also be included. The focus will be on finding (hopefully) "the right" spots to accumulate based on past price patterns going back 5-10 years in order to see where the past may lead us in the future.
If that makes any sense, let's begin.
1. Palladium. Currently 675/oz in USD. Based on the 5 and 8 year charts of technical analysis on Kitco, we can see that the 575 range was successfully tested a few times on its way up to higher prices including 900 within the past year. So, 575 is now support (maybe) and if palladium hits that level should (maybe) be a good time to buy. It would actually make sense to see if it can bounce off it one time, then retest it would be the better time to buy it with more confidence. A tight stop of say 560 would be in order as if it dropped below that level we can see a lot of "air" all the way down to under 500.
2. Platinum. Currently 1075. Has really been in a downtrend, and is still looking weak. The move up from 860 v bottom was so steep it's hard to pick any support in that action. I think under 1000 it becomes attractive to accumulate, and at an 8 handle it's time to back up the truck. Historically platinum is more expensive than gold.
3. Gold. Currently 1175. 1090 looks to be support
4. Silver. Currently 15.75. Near term support of 15.55 bounced off of yesterday in a steep v pattern. I mean steep steep. 15.15 area more support but below 15 it's a guess but I'm guessing extremely volatile so we will have to watch it and see on that one. The last time was ridiculously volatile as it bounced off 14 after hours and was up to 15 within an hour.
Now, all this pricing action is based on a stronger USD and a weaker euro which I believe will be coming if/when this Greek "deal" fails.
-------------------- Anxiety is what you make it.
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Stonehenge
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Re: Technical Analysis and Trading of Precious Metals [Re: LunarEclipse]
#21865172 - 06/27/15 05:25 PM (8 years, 7 months ago) |
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I'm thinking the reason gold is higher than platinum now is because gold is seen as money while platinum is for electrodes, catalysts and so on. They are using various metals in catalytic converters cutting back on platinum and could use more of the others like rhodium or palladium if platinum shoots up. Most countries have tons of gold in reserve but just enough other metals for industrial use. Gold has many industrial uses as well as for jewelry and investment.
Silver too is a monetized metal with many industrial uses but there is so much silver supply and production is going up every year. Prices are low because of that, not so much because of investors getting out, imo.
When the economy becomes rocky, like when Greece hits the fan, gold will be the main beneficiary in my estimation. All metals will go up including copper, aluminum, etc not just precious metals. But how many people are going to go out and buy platinum or paladium when they think their currency is in free fall? A few, but most will think of gold or silver, gold being more compact. If you may have to flee a country, or hide your wealth, you do not want to lug hundreds of pounds of silver, while a couple pound of gold is easy to conceal.
Gold for many years was worth only about 15 times that of silver, now its about 100x. Should we conclude that gold should go down and silver go up because of that? Its more supply and demand than ancient history that will determine the price.
Gold production peaked in 2001 and declined, offset by the price increases which naturally caused more exploration and use of expensive extraction methods. Locations are increasingly remote and expensive to extract with pay dirt having less and less gold per ton. A few grams per ton is considered good. Another factor is environmentalism which means they can't just go anywhere, tear up the landscape, pollute the water and walk away when the mine is played out.
There is lots more gold in the ground but its harder and more expensive to get. I think the price of gold has been kept artificially low for years. Central banks have dumped gold to raise cash and usually have not announced this. There is considerable doubt that usa has all the gold it claims to have. What happens when people want physical gold and they want it right now?
-------------------- “A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835) Trade list http://www.shroomery.org/forums/showflat.php/Number/18047755
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LunarEclipse
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Registered: 10/31/04
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Re: Technical Analysis and Trading of Precious Metals [Re: Stonehenge]
#21865885 - 06/27/15 07:49 PM (8 years, 7 months ago) |
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I think eventually you will be correct about hyperinflation, but in the meantime I think the USD will strengthen if the Greece situation goes south. Or they join BRICS which is a good possibility. This puts downward pressure on the euro so if you are a USD holder it should and normally does drive the dollar higher. Even if the ECB prints up a bunch more money to "solve" the problem by kicking the can down the road a bit further, this creates more downward pressure on the euro also benefiting the USD.
I think a reset of all currencies with bail ins and thievery of deposits becomes a very real threat to your money long long before hyperinflation. This has already been done, and will be a shock to people when their deposits are stolen from them because the banks now have "new laws" in place that treat depositors as creditors. Too big to fail indeed, we just keystroke your money away. How do you like "The Fed" now?
-------------------- Anxiety is what you make it.
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Stonehenge
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Registered: 06/20/04
Posts: 14,850
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Re: Technical Analysis and Trading of Precious Metals [Re: LunarEclipse]
#21866018 - 06/27/15 08:19 PM (8 years, 7 months ago) |
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I agree, le, that is what will probably happen before the big collapse and has been happening. The tpp will no doubt have more of that crap in it too. I've never liked the fed.
But we were talking about pm's and price trends. A stronger dollar will tend to keep prices low while panic and instability will tend to make them higher. It depends on which factor is greatest. If you saw the dollar constantly falling and your buying power eroding away, you would tend to put your dollars into other currencies if it was easy to exchange. In usa its not so easy but can be done. In Europe its easy.
With the euro sliding, the dollar will gain, pm's will gain and bitcoin will gain. The euro has dropped some 30% or so in recent times, that's a big hit to take when you might already be struggling and your savings account has a hole in the bottom. Long before hyperinflation there will be buying of pm's which is going on now. They have some system in place to keep the price of gold low, I'm convinced of it.
What are your predictions of pm prices in the near term and long term?
-------------------- “A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835) Trade list http://www.shroomery.org/forums/showflat.php/Number/18047755
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LunarEclipse
Enlil's Official Story


Registered: 10/31/04
Posts: 21,407
Loc: Building 7
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Re: Technical Analysis and Trading of Precious Metals [Re: Stonehenge]
#21866073 - 06/27/15 08:27 PM (8 years, 7 months ago) |
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Quote:
Stonehenge said: I agree, le, that is what will probably happen before the big collapse and has been happening. The tpp will no doubt have more of that crap in it too. I've never liked the fed.
But we were talking about pm's and price trends. A stronger dollar will tend to keep prices low while panic and instability will tend to make them higher. It depends on which factor is greatest. If you saw the dollar constantly falling and your buying power eroding away, you would tend to put your dollars into other currencies if it was easy to exchange. In usa its not so easy but can be done. In Europe its easy.
With the euro sliding, the dollar will gain, pm's will gain and bitcoin will gain. The euro has dropped some 30% or so in recent times, that's a big hit to take when you might already be struggling and your savings account has a hole in the bottom. Long before hyperinflation there will be buying of pm's which is going on now. They have some system in place to keep the price of gold low, I'm convinced of it.
What are your predictions of pm prices in the near term and long term?
I don't think the Greece crisis will create widespread currency resets right away. As the euro drops, with the economy weak everywhere, demand low, I see metals dropping, not gaining, until the euro hits perhaps 1.06. The dollar over 100 on the DXY will make the metals swoon. That means go down. The charts really do look horrid. My OP describes my price projections on an intermediate time frame so 2-3 months given the strong USD scenario...
-------------------- Anxiety is what you make it.
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Stonehenge
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Registered: 06/20/04
Posts: 14,850
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Re: Technical Analysis and Trading of Precious Metals [Re: LunarEclipse]
#21866211 - 06/27/15 08:59 PM (8 years, 7 months ago) |
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If the euro drops, wont that make all goods including pm's go up in price? It would have to. The metals may indeed drop but a falling euro props them up. They would not be worth more but they would have a higher price. I would look at other factors for a drop in pm prices and the only thing I can thing of is a massive dumping at any price of a large quantity of the pm in question.
Why would anyone do that right now? It would take serious necessity which some countries and individuals may have. Money may be needed to turn the tide of a war and so they sell what they have to sell. Or they are bears on pm's right now. I tend to be bullish but I'm looking at long term more than short term or near term.
-------------------- “A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.” (attributed to Alexis de Tocqueville political philosopher Circa 1835) Trade list http://www.shroomery.org/forums/showflat.php/Number/18047755
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LunarEclipse
Enlil's Official Story


Registered: 10/31/04
Posts: 21,407
Loc: Building 7
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Re: Technical Analysis and Trading of Precious Metals [Re: Stonehenge]
#21874782 - 06/29/15 06:15 PM (8 years, 6 months ago) |
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Quote:
Stonehenge said: If the euro drops, wont that make all goods including pm's go up in price? It would have to. The metals may indeed drop but a falling euro props them up. They would not be worth more but they would have a higher price. I would look at other factors for a drop in pm prices and the only thing I can thing of is a massive dumping at any price of a large quantity of the pm in question.
Why would anyone do that right now? It would take serious necessity which some countries and individuals may have. Money may be needed to turn the tide of a war and so they sell what they have to sell. Or they are bears on pm's right now. I tend to be bullish but I'm looking at long term more than short term or near term.
A falling euro usually means lower pm prices when priced in US dollars.
Watch out for Puerto Rico, it's probably a bigger surprise/threat to the US than Greece at this time...
-------------------- Anxiety is what you make it.
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