china and gold , page-52

"I will be surprised if USD1179 holds on this trip down the slippery slide."

What do you base that on Loki?

After support of the 200DMA was broken (around $1300) I look for support initially at 1270. It’s been holding there for the last hour and a half but I wouldn’t be surprised if that line fails. If 1270 does hold and it closes back above 1280 tonight, I will see that as showing strength. I see better support at 1255-1260. It has been very surprising to see strength in the producer’s days after the price dropped below the 200DMA. Markets are full of surprises. The producers can bottom well before gold.
You can’t be confident about lower or higher prices in the short term even when resistance or supports are broken. Nothing is “baked in”. Trade on assumptions like that and I don’t think you will do well in this choppy market. The only thing I have any confidence in is longer term. Short term anything is possible.

Re: the longer term;
Interview with MD of WGC.

http://goldsilver.com/video/china-s-lust-for-gold-set-to-jump-25/

China gold demand to increase a whopping 25% over 4 years. Last years Chinese demand was only met when 900t was sold from ETF’s. How will the increasing demand be met at current gold prices which leaves most producers cutting back on exploration and new production and some producers scaling back existing operations. POG has to increase strongly within a year or two at most to bring on any increase in supply if Chinese demand does increase as much as forecast. Problem is any increase in price that appears sustainable will see strongly increased demand from etf’s as well instead of selling from etf’s.


Sentiment to none until I see gold bounce off support and close well off its lows and see how overseas producers react tonight and tomorrow night. Currently bouncing to 1275 but plenty of time to go till morning. Again anything can happen short term- down or up.