THE MICIK MARKET LETTER
Gold Update
Alan Micik snippet
Mar 15, 2012
“Beware the Ides of March.”- Soothsayer’s warning to Julius Caesar
MML wrote the following for subscribers on March 4, 2012 (GLD @ 165.76, DXY @ 79.52):
AU fell sharply on February 27th as Mr. Gold Market reacted to the ECB news… unfortunately, this was a classic “buy the rumor, and sell the news” situation. The high bullish sentiment reading we noted the prior week was now too much bullishness for Mr.
Gold Market, so that is now his (and our) new benchmark for contrary opinion. All the previous tops have witnessed 90% bullish readings prior to sharp declines.
In our intra-week Update we noted that it’s usually wise not to act immediately on extreme movements… our view was to
let the dust settle, observe the general reaction to the decline, and re-assess. MML then looked at what reaction (mass
psychology) was coming off this sharp break for contrary clues, and here is what we saw:
- “No problem long-term unless we get to $U.S.1500.”
- “Gold Sell-Off Won’t Change Upward Trend.”
- “…Buying Opportunity.”
- “Analysts Remain Mostly Upbeat About Gold Prospects.”
- “$U.S.1800 Later This Year.”
- “Gold ETF Holdings Reach Record Highs… suggesting investors’ keen outlook on the metal.”
- “GLD holdings rise 9 tonnes on Wednesday’s decline, the sharpest 1 day tonnage rise since January.”
- “Gold Eases Due to Strong Dollar; ETF Demand Hits Record High.”
- “Physical Buying Picks Up Following Wednesday’s Sell-Off in Gold.” “Coin Dealer Reports All Buying on the Drop…
Everyone Has Learned Their Lesson,” she says.
-
“March Tends to be a Strong Gold-Demand Month for China, India.”
-
“Attempts to Stem the Rising Tide of Gold and Silver Will Be Short-Lived.”
Do you notice anything that’s missing?
MML didn’t find a single bearish reaction… not one. No “Fear.”
This is a far different reaction then what we saw around mid-December’s low when major analysts (12/13/11) were calling AU a Bear Market. One widely quoted technician then stated, “We have the beginnings of a real bear market, and the death of a
bull.”
On our 321gold Post of 12/15/11 we turned “neutral” from “extremely cautious” and noted, “Fear is now growing in leaps and bounds for AU and the shares, in
just two short weeks. “Technical” analysts are highlighting all the negatives now. That is to be expected. No need to list today’s
negatives… you’ve seen them. Mr. Gold Market is now creating the news, as Mr. Market has always done.”
(Click image to enlarge)
The “Fear” of December enabled the rebound that one of our proprietary cycles forecasted for a late January / early February
“high.” That forecast was a near “bull’s eye” (excluding the five final days that preceded last weeks drop). Today, unlike
December, there is no “Fear,” and that, conversely, is extremely bearish.
MML also detailed one of our proprietary indicators (which rarely activates), but with its re-activation it now forecasts a gold
“low” time zone for our subscribers.
We also turned bullish on the $U.S. Index (DXY) and listed our forecasted “high” time zone for subscribers based on one of our
proprietary cycles.
Bottom Line: We are now “extremely cautious” on Mr. Gold Market, and “extremely bullish” on the $U.S (DXY) from
March 4, 2012 (with Stops).
We write to be right for our subscribers, even if that’s an unpopular stance. Our philosophy is to never sell ones physical gold
(we might not get it back!), but we do periodically “hedge” it when we identify an “extremely cautionary” scenario for
subscribers. There are “risks” in hedging, of course, but there are also “risks” in owning “un-hedged” physical gold as well. At
this time, we have closed “hedging” profits of >$U.S.145 per ounce and have simultaneously retained our physical gold. We use
Stops to protect ourselves from our own emotions whenever we “hedge” (via “deep-in-the-money Puts on GLD).
If you would like to review our current MML forecasts do consider a trial subscription (details are listed below). In deference
to our subscribers, we have an 8 trading day “Quiet Period.”
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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 and/or trader. Ongoing
coverage is provided for gold and physical gold hedging strategies. Silver & GDX are periodically covered when low-risk opportunities occur. MML uses proprietary
indicators combined with technical analysis, and contrary opinion. 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. Individual shares in any sector are generally not covered, but nor are they excluded. By using baskets
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them on every single trade in order to limit our own emotions. This is a new 2011 publication, but the editor has 36 years of market experience.
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DISCLAIMERS: 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.
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321gold Ltd
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