Fundamental experience is king when it comes to analysis.
Or how do you think that what JPMorgan and CLSA had to say about Macau and it’s gambling sector prospects compares to my analysis three months ago? Couldn’t pick a better area to be lucky in, I suppose!
Though, keep calm, things will look a little shaky from here on out. Volume is still low, and the move from junket-operated to mass market is still a bit uncertain. Target prices will not materialize in a jiffy and will likely be revised before they’re reached. I especially have reservations about Galaxy’s ability to transfer into mass market, and that the best play for that would be 1: Sands, or 2: SJM Holdings. 1 has ran well, but if true mass market returns and the move is strong, then look closer at SJM, given its incredibly more favorable technical position.
OK, quick consolidation from US$1624/troy oz to $1597 (1.6%),with price moving 2-3 US$/minute and ounce either way. Things are after all looking rather abysmal in the euro zone. Expect flight to safety to continue however and yen and gold to both leak higher in next week. Repatriation of euro’s is dead, in all likelihood, and moves this strong forces central banking hands pretty much everywhere that matters.
Now, look out for the key momentum levels in the moving averages. Take a guess, take your time. Done? 200D SMA?
Wrong. It represents very little, and people do not look to it for much than a simple one-glance analysis. Roubini, I just insulted you, sorry, but in my honest opinion even a stopped watch happens to be right twice a day. I vastly prefer EMA’s to SMA’s if you’re just reading price levels, as they better summarize all the price action over the period and how current price relates to them can be read out from the slope. SMA slope is very useful if you’ve seen my raff usage, but this does not apply at the moment in gold unless we get a push back to 1440. Not impossible, but unless you can draw information out from the data points when the SMA period starts, it’s useless to try to decipher longer term price action clues from it relative to the EMA.
That said, I do use SMA’s occasionally, but why on earth would you pick the arbitrary round number for it? Ugh… use the 250 period, it short of 2 days represents a trading year rather than… 9.5 months. Using this way of looking at it, the 250 EMA is at 1592 (we crossed it yesterday! yay!) and 200 ditto at 1620 which we rejected today (ding ding ding! we have a winner… the 21 EMA was much better for explaining this!), 250 SMA clocks in at 1581, and 200 SMA at 1630. Take your pick, but here, just because many people that actually post about the markets are either afraid of math or of actual hard thinking, the general view that the 200 SMA is the line in the sand and what you should watch is fairly laughable! Think hard, it’s your money after all.