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Investigate The Dirty Stock Market



August 25, 2011 – Comments (0) | RELATED TICKERS: GLD , GDX , DZZ

Ever wonder why stocks, commodities and currencies move prior to news? Many times it seems like key big boys, money managers and institutions got word ahead of the average investor. The fact is, they do. I am calling for a direct investigation into the latest gold collapse that saw the precious metal drop from over $1,900 to $1,700 per ounce. After a two day massive drop, the CME raised the margin requirements on gold.

While I gave out the short call on gold. I still think an investigation should be completed. The drop was far too massive to be a "lucky guess" by institutional players. Somehow, someone leaked this news and the big boys dumped right into the small investor buying.

Today, after the news hit, the SPDR Gold Trust (ETF) (NYSE:GLD) is trading at $171.42, -0.23 (-0.13%). After that type of news, to see gold barely down on the day tells smart traders that everyone that wanted to exit did so prior to the news.

The sad thing about this type of action is that it happens on a daily basis. Whether a buyout, new regulation, earnings announcement or other,  the big boys get the tip. As the little investor buys, the big player is unloading. The only way to combat this is to do exactly what I did use the charts to tell the future. I posted a short GLD trade at $181.64. At $174.64 half the short was covered and at $170.64, the other half.

Gareth Soloway

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