Tuesday, June 19, 2012

Six Billion Dollar Bet

Six Billion Dollar Bet

He should have invested ib Gold and Silver....
Watch Six Billion Dollar Bet on PBS. See more from FRONTLINE.

Tuesday, June 5, 2012

Gold Silver Ratio at upper end of range

The Gold Silver Ratio is currently around the 56-57 area which many would consider high based on the coinage act of 1792. (The Act defined the proportional value of gold and silver as 15 units of pure silver to 1 unit of pure gold.)  The ratio of Gold to Silver in the earths crust is somewhere between 15 and 20 to one, I've read that it was 18-1.
So, if one believes that the Gold Silver Ratio will eventually go down possibly under 20-1, this may be a good opportunity to accumulate or add to your position. That is if you are going to hold long term. (Which IMO is over a year and may be another 5 years for this commodity bull market).

Can the ratio go higher?  Sure, possibly 60+ depending upon how speculators see the economy as Silver is tied to an industrial metal.  Economy is bad, less demand for the metal...  at least that is how the street sees it.

Gold rallied huge last Friday and was up quite a bit more than Silver. Speculators will flock into Gold in uncertain times and will generally stay away from it's volatile brother, Silver. Gold is currently leading with Silver following.

The 56 ratio is trading near the recent top produced in late Dec, 2011.  Will a double top be produced? Both RSI and Stochastics are overbought and suggest a possible reversal to the downside. There should be major resistance to the upside just under the 60 level as noted by the low point in Sept 2009.

Sunday, June 3, 2012

Summer Rally?

Nice move in the precious metals markets on Friday June 1st due to the jobs report and the ongoing issues with Greece / Europe.

Gold was up ~$59 for the day and stopped right at the 50 day moving average. RSI and Stochastics were oversold and are heading towards the overbought area.  Technical swing traders may pile in paper gold to continue the push up.
Could May be the low for the year?  Possibly, but you just never know for sure.  Gold was trading near the bottom of the large range that was produced last year between July and early September. It will be a little while for it to pierce the 200 dma and then a crossover of the 50 over the 200.

Silver did not move as much as Gold as it was pulled up because Gold went up. Gold led, Silver followed.  When you have the RSI and Stochastics both in oversold area at the same time, there is a good chance for the investment to move towards the upside. That was the case here, but Silver still needs more speculators to invest for a stronger move to the upside.

The low produced in May was higher than the low produced at the end of 2011 which is a good sign. (Higher lows)

The Gold Bugs Index HUI had a nice day up 6.74% and over the 50dma.  Again, the RSI and Stochastics were both in the oversold area and a reversal to the upside was produced. A push over the 100 and 200dma may signal trading algorithms to take positions in the senior and mid tier miners.

The miners are trading at historic low PE's and speculators/traders are taking positions at these low prices. The street still has faith in the Gold and Silver miners as they were up as a whole while the Dow and S&P were hammered on Friday. (A very good sign)

Swing trading the GDX and GDXJ may be of interest to those that have a side trading account. (Aside from the core physical position)

Monday, May 21, 2012

James Turk & John Embry

The experts are still very bullish on the precious metals longer term. (Years, David Morgan has mentioned 2016)  The fundamental reasons for holding and investing in the PM's are still solid.  The cartel cannot suppress the price forever.

David Morgan Interview

Thursday, May 17, 2012

Gold Double Bottom

Gold has declined back to the lows that were produced in late December 2011 and had a reversal day which shot it up $34 for a close of ~$1575.

Previous posts mentioned that a potential uptick would occur due to the oversold RSI and Slow Stochastics readings.  Both are now heading in the upwards direction (Blue Squares), but will the trend continue?  Especially going into the summer months...?

Circled in Pink are the low points over the last 6 months which many would call a double bottom.  Is the 1530 area the bottom for Gold in 2012?  It's anyone's guess at this point.  It may be a good area to add to a position for those waiting to get into the market.  (And for those that do not believe that this bull market is over).

I'm expecting the trading range to continue until late August, early September.  The seasonals at that time may kick Gold back to the highs that were produced last year.

Gold and Silver stocks are trading at yearly lows, P/E ratios are low for many of the senior and mid tier producers.  When most people want to sell, the Wall Street sharks will gladly take your shares and anyone else that wants to cough them up.  Ride out this storm and if your want to get out, wait for the next oversold / Parabolic move in the HUI, GDX, GDXJ.  (This may be a while)

Monday, May 14, 2012

Gold - Bottom soon?

Gold is still in a sell off downtrend which may be bottoming out soon ?  Sometimes a stock will over shoot to the upside and to the downside before a reversal. Gold may produce a double bottom near the $1550 level which was near the end of December 2011. (Indicated with the light blue line)

If there is a breach through the $1550 area, Gold may do a 100% retracement back to the low point before last summers rally which would be near the $1475 area.

The 50 dma crossed over the 200 dma a few weeks ago indicated with the red arrow.  RSI and Slow Stochastics are oversold, so a rebound to the upside may be realized within a week?  That is unless the sell off continues and the Slow Stochastics become embedded to the downside.

This may be a good time for shorts to cover their positions? Going into June and July, more consolidation and volatility is probable.

Saturday, May 12, 2012

Bottom fishing Gold

Sell in May and go away until Labor Day, is there any truth to this?  Specifically with the Gold market?  Maybe...

Mid term, Gold is in a down trend with lower highs since the top back in August 2011.  It may retrace back to the low in December if the trend continues. No one really knows where the bottom will be for this short term bearish Gold market.  

Should it break the December low, the next significant support low is back in July 2011 just under 1500. That will be a 100% retracement from the major summer rally last year.

RSI and Slow Stochastics are in the oversold area which typically rebounds within a few days.  If the slow stochastic embeds, Gold will be heading lower.  Many see this a a buying opportunity and will be accumulating.

This consolidation period will most likely last for the next few months.  The seasonal demand for Gold in August / September may be the catalyst for the next uptrend. ?

Saturday, May 5, 2012

Gold, Silver, HUI/Gold Ratio

3 year Gold chart, the consolidation continues.  Gold is still trading under the 200 day moving average and is in a slight downtrend.  A mid term wedge pattern is formed which typically ends with a break up or down, we should see some movement one way or another within a few months...?  Possibly post summer...?

3 year Silver chart - A clear downtrend is seen with Silver as well as a mid to long term wedge pattern. It is trading below the 200 day moving average and the RSI and Slow Stochastics are near the oversold level. Similar to Gold, the price will typically break either up or down through the wedge trend lines. The question is, which way is it going to break?

If the cartel want's to cover their shorts, expect the price to break down.  They can load up on ZSL, purchase puts on SLV and short the futures contracts and make a lot of fiat. Maybe the CME will raise margin a few times to slam the price back to the low 20'ies?  Easy money when you know when the margin increases will be announced and in effect.

If Silver should get slammed, the cartel as well as others (Soro's, Carlos Slim, Goldman, etc...) will probably go long to make a few more fiat bucks. A few hundred million is pocket change for them, but they will take the profit...

Gold/HUI Ratio  (HUI Index divided into Gold)  Gold and Silver stocks are trading at lows that haven't been seen in a few years.  Why purchase Gold or Silver shares when the S&P500 is up 8.87% YTD?  (For reference, the GDX is down 14% YTD)

The long term PM charts are still in a bull market, so those with physical bullion can just go about their business without worry. The PM savings account should not be viewed in fiat currency, but in how many ounces you actually own.

Monday, April 30, 2012

Gold still in trading range

Sell in May and go away, come back after Labor Day?  Gold is still in a trading range and looks like it will be that way until some catalyst sparks an uptrend,,, or downtrend...?

Since August of 2011, Gold has traded between $1550 and $1930.  It is under both 50 and 200 day moving averages with the 50 crossing under the 200 last week. (Not bullish)

The RSI and Slow Stocastics looks like they may rebound to the upside for a trend back up.  Gold may just trade sideways until the 'seasonals' kick in which is typically the month of September. The seasonal pattern does not always come into play as last year, Gold and Silver went down for the month of September.

Short and mid term bearish, long term bullish.

As far as the Gold and Silver stocks, they should be pretty close to a bottom unless the PM's sell off for some reason. Their PE ratios are about as low as they have been for years. In a few years, we may look back at the miners in 2012 and see that they were a buy.

Wednesday, April 25, 2012

Gold = Trading range

Gold has been in a trading range which is closing in on one year.  Based on past price history, this is not unusual as a 1.5 year consolidation period has been seen over the past decade bull market.
1 year daily chart of the World Gold Index

Gold is trading under the 200 day moving average which is bearish. The 100 day ma crossed over the 200 day ma on 4/5/12 which is also bearish for Gold.  This can also be seen as an accumulation point for those that believe that higher prices may be coming in the mid to long term.  Over the past decade, Gold has not spent much time below the 200 day ma, we'll soon find out about the current market as May and summer is a few months away.

Here is a podcast interview from GoldSilver.com with Simon Black. He still sees the long term bull market in Gold heading higher and talks about the bubble that has been growing, debt and the debasement of fiat currencies. Also diversifying portfolios outside of the United States.


Sunday, April 22, 2012

Silver rally or continued downtrend?

Below is a daily chart of Silver over the last 3 years.  Since the high that was produced in the early part of 2011, Silver can be seen in a technical downtrend indicated by the blue trendlines.

A technician can say that it is producing mid to long term lower highs and lower lows, the definition of a technical down trend.  Silver is also trading below the 50 and 200 day moving average which is bearish.

On the positive side (for the bulls out there), even though the chart may be seen in a downtrend, the RSI is on a uptrend. Technician's call this a divergence and may lead to higher prices sometime in the future...? 

See the question marks under the green upward arrow...   Why the question marks?  Although this divergence is seen as a potential upwards bias in the future, price manipulation can swing prices and investor psychology away from this market faster than dropping a hot potato. 

Why would anyone invest in the Silver market when you know that the CME can raise margin requirements any time they please and drop the price by 10%+ in a day? (While they go short and make a killing along with those at the CFTC).   It's safer to trade AAPL or Amazon, etc...

The cartel will eventually want to make some $$$ going long at some time as they cannot control the LONG TERM trend which is up.  As long as worldwide countries race to debase, Silver will be a great investment for long term holders.

Tuesday, April 17, 2012

Gold and Silver stocks heading lower?

As if they aren't low enough, Gold and Silver stocks are at a multi year low based on the ETF GDX.  The GDX is similar to the HUI and XAU as it contains large to mid cap Gold and Silver stocks.

Here is a one year chart of the returns for GLD (representing Gold) and the GDX:

Gold has a 15% return and the GDX has a -21% return.

Here is a 5 year chart of the returns for GLD and GDX:

Gold has a 136% return and GDX has 11% return.  Why hasn't the Gold and Silver stocks kept up with the bullion?  Some say that the ETF's are to blame as they do not carry the high risk that the miners have.  Some may believe that Gold has hit a top and will only go down from here, so why invest in a Gold miner?

Physical metals are taxed as a collectible and at a higher rate (28%) than selling a stock / bullion ETF. Excerpt taken from Groco.com

Calculating Capital Gains Tax on the Sale of a Collectible

Uncle Sam takes a tax bite out of almost every asset sold and collectibles are no exception. Indeed, collectibles are currently subject to one of the highest rates of federal taxation on investment property. Capital gain from the sale of a collectible is taxed at 28 percent.
Here is the GDX divided into Gold bullion over the past 3 years:

You can easily see that the Gold / Silver stocks have significantly under-performed the physical bullion.  Some may say that it's best to only purchase physical bullion and that any paper asset is asking for trouble. As Rick Rule has mentioned in past seminars (Like the SF Hard Assets that I went to last November), you want to buy items when they are on sale, not at retail price.  
One way to approach the miners is accumulating a position in the GDX to spread out risk.  It is hard to pick the exact bottom or top, so dollar cost averaging into the ETF would be a good way to go if one believes that the miners will rally at some point in the future.

Sunday, April 15, 2012

Gold Silver Ratio mid April

Like Gold and Silver, the ratio is also in a large trading range which does not look like it is gong to make a significant move one way or another.  That is until a catalyst of some kind moves one of the metals while the other is stagnant.

The ratio is above the 50 and 200 day moving average - Bullish
Even though it has been in a trading range since last October, it is on an ascent - Bullish
It is overbought on the Slow Stochastics indicator - Bullish if it should embed, otherwise, Bearish.

Looks like some heavy resistance near the 58 level which was a low point in September 2010. (Green line)

There is not too much exciting here, the ratio may continue this trading range until fall and the 'seasonals' come into play.  (If they do this year).

Friday, April 13, 2012

Silver Manipulation.....?

There can't be any manipulation in the Silver or Gold market, the U.S. has the CTFC to regulate the futures markets.  (And what a fine job they are doing!) The U.S. also has the SEC to monitor the financial markets, Martha Stewart knows what will happen when a little insider trading happens...

Here is a video of some nice people from the banking sector and quite a bit of data regarding the price of Silver over the last few years...

Thursday, April 12, 2012

SMX to launch gold, silver contracts based on Indian prices

Another Gold and Silver Exchange?  Looks like Singapore want's to start 'playing' the Gold / Silver trading game. I haven't heard very much about the Pan Asia Gold Exchange lately, but I haven't done any research on it either. Having 'independent' exchanges around the world may not be beneficial to the cartel's stranglehold on the short term prices.  I'm sure they would not want Singapore to start this exchange which may start other countries to do the same.

Singapore Mercantile Exchange (SMX), which is backed by Financial Technologies (India), today said it will launch gold and silver contracts based on Indian prices for the global market next month.
SMX E-Gold would offer a convenient trading unit of one kilogram to be traded based on gold future prices in India but quoted in US dollars, SMX said, adding it would be launched on May 8.
SMX E-Silver would trade in 30-kg lot based on silver future prices in India but quoted in US dollars, said SMX.
Both contracts would be cash settled against the benchmark Gold and Silver futures contracts in the East, it said.
"Both contracts are similar to those traded on Multi Commodity Exchange of India (MCX), the sister exchange of SMX," said SMX, chief executive officer, V Hariharan.
"We are introducing the same contracts from our sister exchange in India to the global market in US dollars," he said.
He said SMX would consider launching MCX's other successful contracts for the global market as part of its expansion plans.
Participants in the SMX E-Gold and SMX E-Silver would be able to use and benefit from pricing in the most liquid Gold and Silver futures contracts in Asia, said SMX.
The participants would be able to hedge their exposure based on one of the most liquid precious metals futures and physical market and link hedging to other similar contracts in the world.
Meanwhile, SMX has launched a campaign to expand its trading members, and increase the membership options.
It has started offering transferable, non-transferable and associate trade membership, replacing its existing single category of trade membership.
Jignesh Shah, Vice-Chairman, SMX said, "The new membership offerings will spur entrepreneurship and are aimed at attracting the new generation physical and OTC commodity traders to the futures market to hedge their risks."

Wednesday, April 11, 2012

Eric Sprott Interview on Martin Ellis

Both Gold and Silver and still floundering in their 'large' trading ranges and may continue for some time until some type of catalyst occurs.  (Like the bullion banks want to make fiat going long before they short the crap out of them again).  In the mean time, here is an interview from Eric Sprott.   Just stay long and don't let the PM bear market and consolidation affect your investing psychology. 

Tuesday, April 10, 2012

Bernanke parody

Bernanke parody on money printing...  It's semi-funny in a way...

Sunday, April 8, 2012

Silver and Gold Stocks

Not much interest in both Silver and Gold stocks lately as the HUI index is near the lows around the summer of 2010. The following is a 3 year chart of the HUI index.  It is under the 50 and 200 day moving average which is not a good sign for the index. The RSI and Slow Stochastics are oversold, so a bounce may come sometime within the next few weeks.  Can it go lower???  One word:  Yes

Those that believe that Gold is in a potential bubble and the 1900+ peak last year was the top will not purchase any PM share long and may even go short which has been the trade to make money over the past few months.  Even if money managers wanted to invest in the PM sector, they can always purchase the ETF's and reduce risk.

Here is a chart of the Gold / HUI Index ratio over the past 3 years.  The current price of the HUI index divided by Gold.  It is currently taking 3.7 of the HUI Index to equal one ounce of Gold which is at a high over the past 3+ years.

Most of the miners have been selling Gold / Silver at higher prices than last year and the year before, so their PE ratios have dropped.  Some pay a dividend, so they are getting attractive to those that wish to speculate in this sector.

Investors in this sector may need to wait out over the summer months and into the fall before a potential rally is seen.... ?   Some large institutions may want the prices to go lower so they can pick up some bargains. (They want your shares)

Wednesday, April 4, 2012

Gold trading range,,,,for ?

As mentioned in previous posts, Gold is in a huge trading range and one that may be around for a little while.

It could be in this pattern for a year and a half based on trading ranges in the past. (As noted in a post a few weeks ago).

Only those that swing trade the ups and downs are making any money in the PM markets.  Most are unable to do this because there are people that actually work for a living and do not sit in front of their computers M-F to monitor and trade the markets.

We just trade one currency for another, one may eventually become close to worthless and the other will not only retain purchasing power, but increase purchasing power. One is in a long term bull market and the other is in a long term bear market.

With today's volatile markets, it's just best to turn off the 'kitco' page and focus on family or your hobby.

Monday, April 2, 2012

S. Carolina bill to use Gold and Silver in the future?

Are more states going to use Gold and Silver as money?  (It already is.....but)

At the end, the reporter mentions that Ben Bernanke has stated "going back to the Gold standard would not work because the US doesn't have enough Gold to cover it's debts".   What does this tell you?  In 2013, the US is going to hit the debt ceiling again and those morons in government are going to increase it and spend more.  Do the greedy bankers want more fiat to speculate in the financial markets?  Since congress is bought off by the Wall Street bankers, they can do just about anything they want.

Does an increase in money supply mean that Gold and Silver will go up?  Yes in the long term, no in the mid to short term.  They can raise the debt ceiling, produce more digital fiat and the price for the PM's CAN go DOWN......   It's a farce, but what can you say when JPM, Goldman, HSBC and the banking elite control the price mid and short term...???

Friday, March 30, 2012

A few vids on NDAA, PM's price manipulation, etc...

Both Gold and Silver will most likely be in the trading range mentioned in previous posts.  With summer coming in a few months, I'm not sure what the catalyst will be for higher prices anytime in the near future. The Greece situation was swept under the carpet for now and Europe seems to be stable for now...as we are told by the media....lol.

If you haven't heard of the National Defense Authorization Act (NDAA), it's most likely because Obama signed the bill into legislation on December 31st, 2011.  This is when everyone is NOT paying any attention to the media or what the government is doing in general.  Heck, the local news did not even broadcast this story at all.
There is a line in the 'Act' that mentions if someone is declared a terrorist (even an American citizen) they can be indefinitely detained by the military with no rights to an attorney or court date. This can come in handy when there are outspoken people that the government sees as anarchists, they can make them disappear really fast.

Gold and Silver news from the Mike Maloney channel:

Thursday, March 29, 2012

SGT Vid with 'Ranting' Andy

A good vid/interview from SGT with Andy Hoffman.  Since the market is in a trading range, it's wearing out the bulls and long term holders of the mining stocks.  Andy does not advocate mining stocks as they are 'paper' and only advises people to hold only physical bullion.  I can't argue here, but I do own several mining stocks.  (Which have been in a trading range for quite a while)

Monday, March 26, 2012

Gold Silver Ratio + added bonus video...

Quick update on the Gold Silver Ratio for the latter part of March 2012.  Still in a consolidation range just like Gold and Silver...

The RSI (Relative Strength Index) is producing lower highs which suggests a downwards bias with the GSR.

Slow Stochastics are in the overbought area at ~81.16 (Circled in blue) which also suggests and downwards move in the not too distant future.

Maybe a small rally w/Silver is coming before May/June?  Even if a small rally should occur, it may drop to the lower portion of the trading range and bounce around for a little while.  By then, the summer 'doldrums' come in to play and choppy trading should take over the PM markets and with the GSR.

Bonus Video:  MF Global / Jon Corzine


Wonder if Jaime Dimon asked Jon politely for the 200M?  Or if he said 'OR ELSE' after his request....?

Thursday, March 22, 2012

PM's in Trading Range

Not too much happening in the PM market these days... quite boring as they have been in a fairly large trading range and currently heading towards the lower end of the range.  The day traders and swing traders are making a little bit of money, but there are no solid trends up or down.

Here is a weekly chart of the World Gold Index.  I've highlighted 2 area's in the past of new highs that were produced followed by steep declines.

A new high was produced in 5/2006 and it did not reach the same price until 9/2007, 1 year and 4 months later.
Another new high was produced in 3/2008 followed by the financial crises / sell off and that price level was not reached again until 9/2009, 1 year and 6 months later.

A new high was produced in 9/2011 and Gold has seen a sell off. Based on the 2 examples above, Gold may be in a trading range for over a year.  If that is the case, Gold will not reach the $1920 until Sept 2012 or latter in the year...?  Possibly next year if it takes 1 year and 6 months. (March 2013)

The weekly World Silver Index is an ugly chart IMO. I've drawn major upper and lower trend lines that cut off the overbought and oversold areas.  Silver is currently under the lower trend line which is in the oversold area based on the chart.

Silver has also been in very long consolidation trading ranges.  The parabolic peaks are spaced about 2 years apart, but missed 2010.  Could it spike up again before 2 years? Possible, but probably not likely.  (I'm going out on a limb here).  I personally believe that it should be trading much higher as the Gold Silver Ratio should be around ~20/1 or so...

I'm content with just sitting tight and accumulating either shares or Silver Eagles when possible.  This is in general a long term 'investment' aside from those that swing trade the ETF's and equities.  I have the next major target level of $77 (fibonacci) after it pierces $50. 

Sunday, March 18, 2012

Silver oversold

After the multiple sell offs in Silver over the past year, I'm sure it has scared off potential speculators and investors.  Traders are interested in increasing the value in their account (fiat), they do not care where it comes from.
The PM markets have not been on a solid trend since last year / last summer and there is not much interest in trading or speculating in Silver or Gold.  Many people see these markets just like a stock in a company and just want to trade the swings, either long or short.

Add in the blatant manipulation to the downside by the bullion banks (JPM, etc...) and it's enough to keep anyone out of these markets. Even if the fundamentals for PM's should justify much higher prices in ALL currencies. 

Silver needs to break above the upper trend line that is on a decent.  (For those that are bullish) When?  It almost broke out on Feb 29th, but that is when the criminals set off a 'sell off' in the market.  Those crooks really know when to pick key technical days.

Slow Stochastics are oversold at ~14.  RSI is not quite oversold, but does not need to get under 30 to head back up.  April should be a better month for the PM markets.

Long term - Bullish
Medium term - Stuck in a large trading range.
Short term - Bearish or ask the bullion banks which way they want the price to go.

I'll leave you with a great interview from Jim Puplava who interviews Ted Butler on Silver manipulation:
Puplava - Ted Butler Interview

Saturday, March 17, 2012

Gold bottoming......?

Is Gold nearing the end of the slow, non eventful downturn since late Feb?  It is close to the bottom of the range that it has been in since August of 2011.  If you look at the Seasonal Gold price over the last 30 years, March has not been a bullish month.

As far as the current technicals, Gold is near the oversold area for the RSI and Slow Stochastics.  Most investments that are oversold will get a bid and go on a rally, but for how long?  And how much?  People that are trading the PM's may be looking to accumulate a position near these levels for a certain % gain within a few weeks/month(s).

A chart of the 'evil' GLD w/RSI and Slow Stochastics.  See the oversold areas that are circled in red and the rise in price within a few days/week.

April and May are better months for Gold based on the historical monthly prices.  The markets / traders were looking for the Fed to announce QE3 (or whatever they are going to call it) which they did not do.  This took some of the wind out of the sail for Gold.  But based on technicals and seasonals, Gold may have a bullish run going into May. Will it test the all time high of $1923???

Wednesday, March 14, 2012

Gold takes a hit today and drops $31.31 (1.87%) to $1643, Silver drops $1.26 (3.77%) to $32.15...  Looks like the traders are more interested in making money on Apple than the PM markets.  3 year daily chart of AAPL below:

A 5 year return for Gold is about 148%, a 5 year return for Apple is a whopping 595%, not bad...

The Gold Silver ratio is in a trading range after heading down from spike up in late December 2011. Support may be the 61.8 fibonacci level which is at ~47.13. This level will need to be breached for Silver to start a potential breakout above $35+.

I'll leave you with a recent interview with Ann Barnhardt, who talks about a lot of topics including the government and the laws that do not seem to apply to the the 'elites' like Jon Corzine (MFGlobal).  She is always entertaining, even if you do not agree with her on certain topics.

Tuesday, March 13, 2012

Silver - going up or down???

The daily chart of Silver futures is closing with a wedge pattern which typically ends with the price either breaking to the upside or to the downside.

The upper trendline is in a decent from the high of $49.82 and touches the highs produced in late August 2011.  A few weeks ago in late Feb, Silver almost had a technical breakout above this trend line until the criminals at the bullion banks stepped in and drove the price down.

The lower trendline starts at the low produced in late Dec 2011 at $26.14 and touches the recent lows that were produced in early March. Can Silver continue to trade in a narrow range? Yes,,, until?

But with this type of pattern, the investment (whatever it is) will usually break one way, either up or down.  I know that everyone reading this hopes that it breaks towards the upside. I also know that there are a lot of people that are 'stuck' in their Silver positions (either paper bullion or mining shares) that want to exit and get their capital back. Those factors will present a bit of resistance on the way up if it should break that way.

The $37.60 area may be the next major resistance level on the upside, the 61.8% fibonacci level.

Monday, March 12, 2012

Gold Volatility

Gold's trading range has been fairly large over the last year and is equal to the 2008/2009 years as seen in the weekly chart below. (Box trading range height)

Gold hit a all time high in Sept 2011 of $1915 and a few months later (Dec 29th), hit a low of $1523.  A difference of  $392.  Quite a range wouldn't you say?   Savvy traders that went short over $1900 and covered in late Sept's selloff around the ~$1600 area made a few bucks.

Those that are invested in the PM market should get used to the volatility going forward as it's going to increase.  When Gold is at $1900 an ounce, a 5% move either up or down in one day is $95.  It's a day traders dream to have this type of range...

As mentioned in the previous post, having a long physical position and a trading account may be the best of both worlds as far as investing in the PM markets.  You can view the short term swing trades as your part time job as it does take quite a bit of technical analysis work and timing.  It may not be fore everyone, but I would rather have this part time job rather than working somewhere...

Sunday, March 11, 2012

Swing trade the PM markets? Can't beat them, join them?

Does it make sense to join the cartel to short the PM markets to make some US $ fiat?  It depends upon one's thoughts on the USD going forward.

I'm sure most people with debt would like it to pay it off and live debt free.  (Pay off that mortgage, car payment, visa card, etc...)  You'll have to do it with USD's, not Gold or Silver.  Although both of those PM's are increasingly becoming accepted as currency.

It is not as easy as it sounds, but one can defiantly make some money (USD fiat) by playing the swings in the PM markets.  Most traders like volatility as that is the way they make money, by either going long or short for specific periods of time.  If one just swing traded the run up in the Silver market in 2011, they would have done quite well.  For those that purchased in January and held to the end of December, they virtually had zero gain.

Swing trading long when either Gold or Silver is producing higher highs and higher lows.  And on the other side of the coin, shorting when Gold or Silver is overbought as seen with the RSI or Slow Stochastics indicators. Sometimes the cartel selects a certain Fed speech to initiate the raid, I'm sure there is someone that has collected data on this somewhere.

Having both long term and short term investments may be the way to go for some people.  Most should have a certain percentage of their PM allocation in the physical metals.  Silver can be used should the USD completely collapse. It is possible, but I do think that the government will step in at some point and peg what's left of the USD to Gold.  Another long position can be with solid mid and senior miners that are cash flowing and paying a dividend.  Newmont is among the leaders in this sector.

Outside of the long term positions, short / mid term trading can be done with the ETF's.  I know there are those that will not purchase certain ETF's because they cannot prove that they have all of the metal that the prospectus states.  I personally do not believe that they will be diverting from the metals price anytime soon and can be checked easily by over lapping the charts.  Most people will run a stop loss or a trailing stop when trading the ETF's which is the safe way to play them.

One problem with swing trading - It take a lot of technical analysis and TIME.  Something that most people do not have enough of.

Swing trading the miners as a group can be done with GDX, GDXJ or SIL for the Silver miners.

Disclosure: I am currently long on SIL, Global X Silver Miners Index.  I have no position in GDX or GDXJ at the time of this writing.

Wednesday, March 7, 2012

David Morgan interview regarding junior miners

Another interview with David Morgan who talks about Silver miners, risks, potential gains, etc...    

The Gold and Silver markets are recovering slowly from last weeks raping. Lets see if the criminals want to make some fiat 'wipe your ass paper' in the PM markets and go long for a little while...?  We may get at least one run up before May and the summer slump...  That is if the bullion banks allow it to.

Monday, March 5, 2012

White collar criminals at it again

What can be said about the smackdown last Wednesday in the Gold and Silver markets? (Feb 29th)

Here is a link to Ed Steer's Gold and Silver daily blog (Casey Research) which has some detailed information on the transactions from the CME and COT reports.


Guess you really can't be surprised with the sell-off, especially when 'they' crushed it in May 2011, September 2011 and December 2011.  They do it to make $$$ shorting futures, puts on SLV, going long on ZSL.  If you can front run the markets and make money just about anytime you want and get away with it, wouldn't you do it too?  The key is that they know that they are not going to JAIL...   White collar criminals at the CME, LME, CFTC, SEC.  IMO, they are all on the same page and can make a lot of fiat manipulating the markets on the downside.

If many of the sheeple realized what the Central banks around the world are doing, they would put quite a bit of their net worth in the precious metals.  That would pull them out of the stock market, mutual funds, IRA's, 401k's, etc...  It would bring the markets down if enough of the sheeple pulled their money out.

And if the stock market should crash in 2012?  Obama's ratings would head further south and his re-election bid would most likely go down the tubes.  Once people opened their 401k statement and it looks like it did in late 2008, early 2009, they would really think about who they would vote for.  (Obama also has the Oil price to worry about........)

So the bashing in PM's continues.  For those few (sheeple) with their eye on the PM's, the smack down's are violent enough to keep many of the speculators away.  They see that it has gone up for a decade + and it's too late to get in at the 'top'. They got drilled with the dot 'con' market in the late 1990's, their home has declined in value since 2007 and their equity portfolio was cut in half in 2008/2009.  Many people have had enough with investing because many of the sheeple have only lost money.

But 'investing' in PM's is not really investing.  How is that?  Because you are trading one currency for another. Your trading paper fiat for another currency which is considered a hard asset. The hard asset has been used for 5000 years and has never failed like ALL of the fiat currencies that were ever produced.

Silver smackdown on Feb 29th

Gold Smackdown Feb 29th

So what to do?  I'm buying more, continuing to dollar cost average into both physical Silver and select mining shares.  Do not let the paper price affect you, as long as the central banks continue to debase their fiat currencies, the long term outlook for PM's are great.  The criminals smackdowns should be less effective in the coming years as more of the sheeple will wake up, but they are in control in the short to mid term.

Thursday, March 1, 2012

Greg McCoach interview w/Al Korlin

Gold and Silver bounced back up today after yesterdays sell off.

Silver is still trading over the 200 day moving average which is a good sign.  The 50 dma is just over the 100 dma which is also bullish.  With a continued uptrend, the shorter term moving averages will cross over the 200 dma (orange) which should bring more speculators into the market.  (Computer trading algorithms and HFT will also kick in)

Here  is a quick vid of Korlin interviewing Greg McCoach.

Wednesday, February 29, 2012

Interview w/Jay Taylor and David Morgan

Both Gold and Silver were hit by heavy profit taking this morning/afternoon.  The end of the month and some want to close out positions and maybe play a little defense going forward...?  In any case, both PM's should end higher for the month of March based on the upwards trend that started in January.

Below is a basic interview with Jay Taylor and David Morgan.

Sunday, February 26, 2012

HUI Index,Gold and Silver, what else?

Here is a weekly chart of the Amex Gold Bugs Index (HUI) since late 2002

Based on the historical performance of the HUI, you can see that it has 6-12 month rallies followed by consolidation periods of up to 2 years.  The financial crises a few years ago is clearly seen near the end of 2008, but a quick recovery is seen shortly after the selloff.

The HUI has been in a ~1.5 year consolidation pattern which may be ready for the next 'leg' up. Fundamentally, miner earnings are up with Gold trading over $1550 an ounce over the past year and Silver over $30. So why isn't there speculators with the Gold and Silver stocks?  
* If your in the camp where Gold is in a bubble, why would you or your company invest in a mining stock?
* If Gold and Silver bullion is in a rally, why not buy the bullion ETF's and take out the miner risk?
* There are many other areas to invest in and get solid returns, other commodities like Oil, Corn, Sugar. Certain stocks in the S&P 500, etc.  There is also less risk compared to mining stocks.

But, when solid earnings and announcements of increased dividends are paid out, more speculators will enter this market and push the HUI higher. Technically, it needs to break the downtrend line near ~565.

Then break above the last high produced last September of around ~638.  I have a projected target of ~735 once the breakout occurs.  The projection is based on the 2003 fibonacci high and low points for that year seen in the weekly chart above.  You can also see that the 261.8 fib level is support right at ~500 which the HUI has touched and bounced off of quite a few times over the last 1.5 years.

Can you profit from knowing this?  IMO, yes.  I am personally invested in various Mid tier and Junior mining stocks, all of them are in production and have earnings.  I believe that this will have the best returns.  Swing traders should have a really good year if and when this index starts to rally.  We may see it before Man/June and another rally in late August/Sept.  That is contingent upon the entire financial markets staying afloat...

For those that want less risk exposure to the miners and still want to get into this sector, the GDX and GDXJ are a good start.  Silver miners only ETF is SIL. There is even a 3x leveraged mining ETF for those hard core bulls: NUGT.  (This is one that you may need to keep a finger on the mouse button)

Disclosure:  As of this writing, I do not own GDX, GDXJ or NUGT.

Thursday, February 23, 2012

Bullion breakout

The PM markets are finally breaking out of their base at the end of January.  Silver was up to $35.56 which broke above the major lower trend-line.

One of the next resistance levels will be around the $36.75 area, the orange downtrend line.  The bullion banks may be loading up on the long side as well as the hedge funds that spot upwards and downwards trends quickly.

Most of the junior, mid tier and senior miners are also following Gold and Silver's uptrend.

Year to date returns:

GLD (Gold) 13.83%
SLV (Silver) 27.69%
SIL (Silver miners index) 20.25%
GDX (Gold miners index) 11.33%
GDXJ (Junior Gold miners index) 19.71%

The senior miners are slightly under-performing Gold at 11.33%.  Speculators seem to be placing their bets on the undervalued Junior miners at this time.  The Silver miners index is under-performing the bullion YTD, but that may change with increasing bullion prices and good earnings reports.

Swing trading the bullion and mining ETF's to the long side should be profitable for the next few weeks.

Monday, February 20, 2012

Gold Silver miners lagging, for how long?

Here is a snapshot of the fundamentals for the Van Eck Gold Miners ETF GDX which indicates the historical earnings growth of 33.40%.

Here is a 1 year daily chart of the GDX which has a return of -8.19%

In general, the Gold and Silver miners are undervalued and not recognized as a 'good' investment by Wall Street at this time.  Investments go from undervalued to fair valued to overvalued.  The GDX and the miners in general are undervalued at this time and a rally with the shares may be realized sometime this year.  Trailing price/earnings are 16.85 for the GDX which should continue to drop with solid earnings. 

The million dollar question is when will the shares start a breakout run?  It's anyone's guess... If the analysts on Wall Street believe that Gold is in a bubble, why would they invest in a Gold miner?  Especially if they think it's going to crash?

Gold may need to get back above the $1800 level before interest returns to the mining shares.  I'm looking for a rally some time before May in the shares. We shall see...

Sunday, February 19, 2012

David Morgan at the California Resource Investment Conference

David makes a good case for investing in Silver going forward in his presentation at the California Resource Investment Conference.

Another interview of David at the show:

Friday, February 17, 2012

Year to date returns for bullion and mining indexes

With Gold and Silver selling off in December 2011, the bullion as well as the miners are up so far in 2012. Even with the nice percentage gains since the start of the year, some people may still be holding onto miners with a loss.  Those that purchased any Silver over $35 or Gold over $1750 are in the red...

Year to date percentage gains are as follows:

Gold:   10.11%
Silver:  19.69%
GDX Van Eck Gold miners index:  5.29%
GDXJ Van Eck Junior Gold miners index:  12.71%
SIL  Global X Silver miners index:   14.17%

Silver is leading the way so far in 2012, followed by the Silver miners index.  Then the GDXJ, Gold and bringing up last place is the GDX.  Will this be the year that the mining stocks out perform the bullion?  Will there be more speculators in the junior mining sector?

If you invest in mining stocks, you may want to keep an eye on the market cap that is performing the best.  Juniors?  Mid tier?  Seniors?  Gold?  Silver?  Combination?   How about individual stocks compared to the ETF indexes?  Which one will outperform the index?  (If I had a crystal ball, I wouldn't be writing this and if you had one, you wouldn't be reading this)    =) 

Wednesday, February 15, 2012

Fibonacci level resistance for Silver

Just to add a quick chart of Silver as a follow up to yesterdays resistance points, I added a Fib retracement from the low created just before the massive run up of $17.84 to the high created in April 2011 of $49.82.  This placed the 50% retracement at $33.83, right where the major resistance has been over the past few weeks.

I know that there are a lot of investors that are tired of waiting for the mining shares to appreciate in value and I'm also in that camp.  Many gurus will say that we will need to hold onto these shares for a few more years before they really start to take off.  I also know that many investors are discouraged as they may have some losses in this sector while other stocks like Apple and the indexes have really appreciated over the past few years.

Some may want to start swing trading the mining stocks, so you will not have to hold onto them for long periods of consolidation and some even on a technical downtrend.  There should be a decent sized rally before May of this year, that would be the best time to exit some positions. The re-entry may be in the late summer months when both Gold and Silver are flat to down.

Tuesday, February 14, 2012

Rodger Weigand forecasts Gold & Silver

From Kitco video at the Investment conference in Palm Springs, Rodger Weigand mentions that he sees both Gold and Silver to move higher in the coming months and onto potential new highs towards the end of this year.  I'm not sure how he obtains the numbers and the specific months for them to rise, but I'm sure a lot of people would like the PM's to go back to their old highs and pretty soon...

Monday, February 13, 2012

Silver - 2 major resistance points

Weekly World Silver Index with upper and lower major trendlines drawn. These trend lines cuts off the parabolic moves up and the selloff in 2008.

Silver dropped below the lower trendline in the sell off in September 2011 and bounced along it until the sell off in December. Also note that the chart formation has a triple bottom in the low $26 area.

1 year Daily Silver chart gives a closer view of the resistance areas:

Silver has hit the lower trendline which has been a major resistance point.  Once it pierces the lower trendline, the 2nd major resistance area will be the orange trendline from the $49 high to the peak made in late August 2011. This is roughly around the $35 area which is also the area of resistance in October/November 2011.

With all of the 'money printing', Silver should probably be trading north of $75 at this time.  When you have corrupt entities like the CME, CFTC, LBMA, Goldman Sachs, JPM, HSBC that can push these and other commodity markets around to their favor, this is what you have.  A suppressed market.  Get used to it and if you are a trader, try to be on their side of the trade.  I know it's hard to short a market that is long term bullish, but that is how good traders make $$$.

Sunday, February 12, 2012

Andy Hoffman Interview (Miles Franklin)

Here is an interview with Andy Hoffman from YT.  He mentions that the $1750 level in Gold is a key resistance point and will eventually become support.  Once that occurs, it may be off to new highs for the Gold market.  Silver _should_ follow along for the ride.

1 year daily chart of Gold

Since the sell off in December, Gold has pierced the fibonacci levels of 38.2, 50* and found resistance at the 61.8 level which is right around the $1750 level.  It may bounce between the 50% and 61.8% area to consolidate before a potential move up towards the old highs.  This may take place before May of this year......  

Sell in May and come back after Labor Day ???  Wonder if there is any truth to that this year for the Gold and Silver markets?

Thursday, February 9, 2012

Gold consolidation before........?

Daily chart of the World Gold Index from March 2011.

Gold has been in rally mode since the start of the year as all of the selling for tax purposes was done in December.  It has pierced through the fibonacci retracements of 23.6, 38.2, *50 and has stopped at the 61.8 resistance level.
It is trading above the moving averages which are in bullish formation with the 20 day over the 50 and the 50 over the 100.  Stochastics are moving lower which may indicate a pullback.

Gold should consolidate here before a potential move up towards the all time high which was hit in August / Sept last year.  Once this move is achieved, the Gold and Silver stocks should follow and may present some nice areas for profit taking before the seasonal summer downturn / consolidation.

Thursday, February 2, 2012

Weekly Silver, bullish trend

Weekly chart of the World Silver Index going back to mid 2002.

Major upper and lower trend lines have been drawn with the parabolic peaks shown with the month and year.  David Morgan has mentioned that the short and mid term price can be 'manipulated', but not the long term trend. 

You can see the overbought peaks and the oversold areas/periods.  Each time the price has come back to trade between the upwards major trend lines.  If the current rally brings the price to the midpoint between the upper and lower lines, it should be around the $42-$45 area.

Weekly Stochastics K and D lines are heading back towards the 80 level and based on past history, it has a little more to run before a pullback.

There was a triple bottom at the $26 area which may be the last time it dips that far going forward.

Silver is still a great value as Gold has breached it's 1980 price of ~$850 in 2008 and is currently trading around the $1750 area.   Silver is still UNDER the 1980 price of ~$50 and is trading around $34.27.

Sunday, January 29, 2012

Gold rally, pull back, rally

Looks like the low for Gold that was hit in late December 2011 may be the low for the next 12 months???  Everyone with a 1/2 a brain is buying Gold now, China, India, central banks, etc...  If you can debased your own currency and purchase Gold with it, wouldn't you do it?   'Print' your own currency, exchange it for US Dollars and purchase Gold.  Legal counterfeiting..... what a joke....

Daily chart of the World Gold Index going back to the high of 1915 that was produced in August 2011.

Looks like it's all green lights to the upside since the sell off to the $1523 level.
It is currently trading above the exponential moving averages of 20, 50, 100 and 200.
The 20ema is about to crossover the 50 and 100ema, bullish.
It has broken through the downtrend resistance line, bullish.
Stochastics are embedded to the upside, bullish.
It is riding along the upper Bollinger band, bullish.
RSI is overbought...  correction will occur...

The $1750 area is the 61.8% fibonacci pullback level based on the last major run-up in August.  We may hit that area, pull back for a small correction back to $1700 and head higher in an attempt to reach the old high of $1915.  We may see this before May of this year...?  Then pull back for the summer months until Aug/Sept rolls around...   We'll see, no one has a crystal ball.  If someone has one, there is a crack in it...

Silver should follow Gold's path to the upside.  The Gold Silver Ratio has been dropping with this early year rally and is current at 51.15 from a high a few weeks ago of around ~59.

The Gold and Silver miners are also rallying to the upside.  Quarterly earnings should propel the stocks higher in the coming 1st and 2nd quarters.

Thursday, January 26, 2012

David Morgan interview at Cambridge House

The Silver Guru, David Morgan gives an interview while at the Cambridge House Investment Conference.

At the end of the interview, David mentions that he is invested in a company that supports mining companies.  I am not a current subscriber to his newsletter so I do not know which company he is talking about. I did talk with a company at the SF Hard Assets Conference last November which was Energold Drilling.  They rent drill rigs to mining companies and from what the spokesperson told me, they were really busy renting and flying in drill rigs around the world.  They trade on the Canadian venture exchange, ticker EGD. For the U.S. it is traded on the Pinksheets market as EGDFF.

Not too shabby, a 28% gain over the past year and a nice move up since the SF Hard Assets Conference in late Nov............   This is not a buy recommendation as I am not a registered investment adviser or CFP.   Disclaimer:  I do not own any shares of Energold Drilling at the time of this writing.

Wednesday, January 25, 2012

Gold Silver Pop, HUI analysis

After the fed mention that interest rates will be low until 2014, both Gold and Silver popped to the upside.  Gold was up $44.40 to $1710 (2.66%), Silver was up $1.22 to $33.27 (3.81%).  This may be the start of a solid 1st quarter upside rally...

As far as the Gold and Silver stocks, here is a weekly chart of the HUI

The HUI has been in a sideways consolidation since the 4th quarter of 2010.  With both Gold and Silver prices higher than the 2010 prices, earnings for mining companies that are in production will be able to beat the 2010 and 2011 quarterly and yearly earnings.  This should be enough to spark the miners to the upside sometime within the 2012 year.

A fibonacci retracement is drawn from the run-up in 2003 and the 423.6 level is around the ~735 area.  This may be the next stop/resistance area for the HUI index.

Some have speculated that because of the Gold and Silver ETF's, the interest in mining stocks have gone down.  There is less risk with the ETF's compared to the risks of holding onto a mining company which can report many negative items and issues with regards to their mining operation.  There are risks with the ETF's, but those that are invested in them are most likely trading them and not holding them long term. If the ETF's start a divergence from the bullion prices, the hedge funds and all those on Wall Street will have their finger on the mouse button to exit first asap.

You also hear many analysists state that Gold is in a bubble and that it is going down.  If these fund managers believe that Gold is in a bubble, do you think they will invest in a Gold or Silver miner?  Probably not...  

Monday, January 23, 2012

Gold Silver Ratio

Silver has been outperforming Gold over the last few trading sessions and is seen as the Gold Silver Ratio gapped down towards the lower part of the sideways range and below the bottom trend line.  It is now also below the 20 and 50 day moving averages.

A few weeks ago, there is a post on the divergence between the rising Gold Silver ratio and a declining RSI, which suggested a lower ratio.  Well, we now have a lower ratio, but will it continue to decline?  It needs to drop below the last significant low which was around the 48.5 area indicated with the orange horizontal line.

The MACD and RSI are also on the decline, so it looks like a lower ratio may be realized within the next few days/weeks.