THE MICIK MARKET LETTER
Gold Update
Alan Micik snippet
Posted Jan 30, 2012
The last seven months of gold action has created both euphoric emotional highs, and despondent emotional lows. But, if
you take the approximate high as $1900, and the approximate low as $1600, the middle ground is $1750 (about 169.50 for
GLD), which is exactly where we are priced today. What that means is that anyone that has bought a prolonged advance, or sold
a prolonged decline is at a loss (or a break-even at best) during this seven month stretch.
(Click on image to enlarge)
That’s important because it tells us the weakest buyers of the last seven months are directly above the current price structure.
Also, note that those highs of August, September, November, and December witnessed extremely high sentiment readings of
over 90% Bulls on some surveys (80% readings are cause for concern). Bottom line, gold has been a trading market, not a
trending market for seven months, and that is despite all the bullish news! Will Mr. Gold Market advance back to those highs
right now, or is all of this churning leading to more downside action?
Back on December 5, 2011 ($1751 gold & GDX $58.25), we wrote on 321gold 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. It was a truly unpopular forecast, as we were “extremely cautious” and “hedged” our physical gold.
It can be read here.
Gold then hit $1524, and GDX hit $49.22 in late December of 2011. That, however, was fortuitous for our subscribers, as we
covered our “hedge” on our physical gold well below $1600. Since then, we’ve held our physical gold, and have seen gold
rebound to about $1740 (we never suggest selling one’s physical gold-we might not get it back!). So today, our physical gold
is back to approximate all-time highs given that “hedge” profit (profit of > $151 +$1740= $1891).
We don’t always get it this right; no one does, as we are all human. We only “hedge” when we identify an “extremely
cautionary” scenario, and we use Stops to protect capital from our own destructive emotions.
So, where does gold go now?
At $1750 or so we are smack in the middle of our seven month range.
For the Bears: That’s not much of a price achievement given the world news of the last seven months. We have many weak
buyers directly overhead. Bullish sentiment is, once again, increasing to unhealthy levels.
For the Bulls: We have broken a four month downtrend this week with the “FED” news. Technicians will note that Mr. Gold
Market moved above the Apex of his triangle, and this is assumed to be bullish by chartists.
For Us: We are a “Non-Bug” regarding any market. We think that Mr. Gold Market will shortly provide us enough Evidence to determine if a change in strategy is necessary, and that would be immediately sent to subscribers. So, consider our newsletter,
details are listed below.
What we are looking for this week now follows for subscribers…
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Jan 29, 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.
The Micik Market Letter uses proprietary indicators combined with technical analysis, and contrary opinion. This letter is published when low-risk market opportunities are identified for the investor, trader, or hedger of physical gold. Unlike other market reports, we do not have regular “publication dates,” as the markets create the dates of action, and thus the communication to our subscribers. This is a new 2011 publication, but the editor has 36+ years of market experience.
SUBSCRIPTION RATES: US $125 per year which includes all Special Reports, Updates, and Position Alerts for each subscription. No refunds (except pro-rata
refunds due to editor illness or death), so do take the trial service. Trial subscriptions (one-time): US $25 for 3 months. This is an email service and subscription checks should be sent to:
The Micik Letter
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DISCLAIMER: Market opinions and recommendations detailed in this letter, while expressed in good faith, are not guaranteed, and losses will occur with any investment strategy, including this service. Each investor/trader/hedger must carefully manage to their individual risk tolerance and use “stops” to control their risks. At no time should the subscriber infer that opinions or recommendations are customized actionable advice, or be construed as an inducement or suggestion to trade or invest. The editor, publisher, associates, directors, consultants, employees, and accounts under management may, or may not, have positions in securities or derivatives described herein.
321gold Ltd
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