THE MICIK MARKET LETTER
Gold and the Goldies: Shock & Awe??

Alan Micik snippet
Posted Jan 4, 2012

Back in late November, we wrote that Mr. Gold Market likely had some “unfinished business,” the break of the long-term uptrend around $1550 in order to create “Fear,” and that then it would be time to re-evaluate. We hedged our physical gold at that time and recently closed that hedge (we never advise selling one’s physical gold - we might not get it back!). The article can be reviewed here.

Gold broke $1550 last week and “Fear” has now returned to the gold and Goldies market. Many are now calling gold a Bear market, or, if gold rallies from here it would “not be sustainable.” Our early “take” after this carnage is that the damage to investor psychology by a $183 drop in 30 days is enough. This decline has exceeded all prior 2011 declines given the extremely bullish sentiment readings of 90% from late November. We don’t see any significant down-moves over the near term, and so we are observers, for now.

The “shock” of this decline in the midst of Europe’s woe’s surprised many gold participants, as there were no apparent fundamentals that could justify a severe decline right as the ECB would launch more “money printing,” and in light of gold’s seasonal tendency to rise late in the year. What couldn’t possibly happen did, “because.”

That “because” factor is always the same-excessive fear, or excessive greed, in any market, not just gold. We try to isolate those infrequent excesses of greed and fear, and position ourselves in a “contrary” manner when there is Evidence to do so, since the fundamental “news” is almost always “baked into the cake.”

But, where there is “shock,” there can also be “awe!” We have just issued a Special Report which covers the “awe” that we are now forecasting. This is available for all regular and trial subscriptions - details are noted below.

The Special Report follows for subscribers…

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Jan 1, 2012
Al Micik
email: atmmail@sbcglobal.net

The Micik Market Letter (MML) covers opportunities in any market sector when low-risk opportunities are identified for the investor or trader. Ongoing coverage is provided for gold, physical gold hedging strategies, and GDX. Individual shares in any sector are generally not covered, but nor are they excluded. By using a baskets of stocks (ETF’s), we seek to decrease our risks and have improved liquidity when it’s time to exit a position. This enables us to use reasonable Stops and we use them on every single trade (usually at position entry, but always within one week of a position entry), in order to limit our own emotions.

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