Gold Futures Options Chain

The Gold futures options chain for the June contract expiry demonstrates very clearly why people might think it was a market for manipulation.

On the one hand, you have put options ranging above this weeks' spot price, but not below it, and call options all ranged below this weeks' spot price, but not above it.

Normally put options would range below the spot price, not above it, and call options would range above the spot price, not below it.

The contracts clearly suggest that if prices were either meant to fall from here, presenting the only buying opportunity, and should they rise at all whatever the price might be, that it would only be an opportunity to sell.

My guess is that traders will avoid the obvious absurdity of trading under these conditions and trade the spot price instead. But, you never know.

http://quotes.ino.com/options/?s=NYMEX_GC.M12.E

$Gold Weekly

The weekly gold price chart is showing yet another hammer formation, this time red. Last week, I could only be certain that the hammer candle was black last week, but later changed to white. Probably the data was corrected in the end.

The 89-week EMA was re-tested again, confirming that this latest correction is a major correction in the gold bull market, and a technical consolidation with the low in Dec. 2011.

The two models I'm following at the moment are the Sharelynx eWave and Realterm's Dax In Gold. I like them because they both have the same approximate end date.

http://sharelynx.com/chartstemp/GoldeWave.php

http://realterm.de/DAXinGold.php

supersize: http://www.flickr.com/photos/11747277@N07/7272894994/sizes/l/in/photostream/

stockcharts.com

Dodd-Frank

The Dodd-Frank act was meant to regulate financial markets, but in the main its mostly a pork-barrel to protect risk cartels on Wall St. and their control of the derivatives markets. Now the U.S. means to exert extra-territorrial powers in regulating foreign resource sector operators. The reasoning is unclear, but I presume it to be an act where the SEC can impose penalties on U.S. listed foreign miners for arbitrary reasons.

If you look at any listed company through the Bloomberg website, you can see what exactly transparency means, that financial statements must conform with IFRS, thus complying better with derivatives contracts that use the same extent of variables in calculating a share price.

http://watch.bnn.ca/#clip686331

http://www.investopedia.com/terms/p/pork_barrel_politics.asp#axzz1vynWZlEz

-F6