…We are on record for consistently advocating the purchase of gold and silver over the past three years, regardless of price. Some may fault us for exhorting purchases at much higher prices than are current but the recommendations were for wealth preservation and not for speculation or profit…[While] the timing has been off [and, as such,] we can be criticized for the albeit temporary erosion of supposed wealth preservation (and in some cases, the erosion is substantial), the reasoning, or purpose, for buying and holding remains the same today, and even more pressing…
A “war against cash” has now perked to regular news status to massage the public into accepting this form of slavery, which is all it is. The only thing the issuers of fiat can do to keep their Ponzi currency scheme going it to make it impossible to use any other form for money. Cash transactions are not recorded in the banking system, and that is unacceptable to those in control. Gold and silver fall into the anti-fiat category and outside of government control…
The window for buying, holding, owning gold and/or silver is closing. Problem, Reaction, Solution. Those dealing in PMs are outside of the system, a Problem. The Reaction is to make it extremely difficult to buy and hold gold and silver, unless it is in open public record where the federal government can come after you. Solution? Brand PM holders as economic terrorists. Sound far-fetched?
We have recently discussed how there is no confirmation of a bottom in place, and then gold shoots up in an unchecked rally, seemingly making moot our point. Maybe, maybe not. We are less concerned in calling the bottom than we are in recognizing one is in place. There have been lot of so-called the-bottom-is-in articles that were simply wrong. We have never been in that camp since gold and silver began their step decline over the past 6 years. We may miss a 10%, 15%, even 20% rally once a final bottom is in place, but only in the paper futures market.
Our call for the ongoing acquisition and holding of physical gold and silver has never wavered, however untimely some of those recommendations were when gold was over $1,500+ the [troy] ounce, silver over $30 the [troy] ounce. Like almost everyone else, we did not foresee the globalists exerting so much manipulative influence across all markets for as long as they have. That is past, and we do not use a rear-view mirror for physical purchases made.
Are we starting to see a bottoming process? Yes. Does that mean a bottom is in? We do not know, yet. The rally ran into a zone of resistance as seen on the chart. The current rally is but one of many steps in a bottoming formation. Each successive step confirms the one that came before.
The next step will be to watch the next downward reaction to see how it unfolds in order to assess the significance of the rally over the past two weeks…
Gold: Weekly Chart
What validates the weekly resistance area is the activity on the daily chart [see below]. There is no apparent resistance on this lower time frame that shows up over a year ago on the weekly. We have often stated that smart money, (aka controlling interests,) buys low, sells high. It is also axiomatic that unusually large volume surges are from smart money in action. The public simply do not act in such a coordinated effort in concert to create heavy volume days. The public only react.
The persistent rally in gold attracted a lot of attention breaking above moving averages and/or above prior failed rallies. The public do not want to miss out on the move higher, and each successive daily high whetted the appetite to want to buy gold before-it-became-too-late. Thus, the huge reaction rush by the public when gold went higher without pause. Guess who were willing sellers to the public at the higher prices? [Yes, it was, and still is, the smart money – the controlling interests.]
Gold: Daily Chart
Whenever you see a substantially wider price range in a rally, accompanied by a huge surge in volume, odds favor that day as being a climatic buying spree that ends the rally. This is exactly what you see on the daily gold chart. A reaction to the downside will likely follow, and it is how the reaction unfolds that will tell us if higher highs will follow, or not. The next week or so may be revealing as to the significance of this recent strong rally.
Silver: Weekly Chart
Silver has a much stronger fundamental underlying situation, yet for now, it continues to underperform relative to gold. If the Nov-Dec-Jan bottom trading range is the bottom, it will have fooled us, but it has yet to be decided as to final bottom status.
Silver: Daily Chart
The [first] daily chart [below] cuts off at the beginning of February, prior to the current rally. We want to show how the market provides pertinent information based on past market behavior. There was a swing high established last October when price closed strongly, and it then gapped open lower, net day. The price high is obvious resistance, and so is the high of the next day’s open when price could not regain the gap and continued lower.
We drew in dashed lines to reflect how this failed swing high can influence future market behavior, a fact known well in advance.
The same horizontal line was in effect when silver rallied to the lower portion of the zone of resistance. A weaker market will tend to fail at lower resistance areas rather than exceed them, as gold did. The unusually wide trading range and the huge volume surge were red flags for a possible buying climax at a recognized area of resistance. We will be more certain of this once any reaction lower unfolds in order to assess the character of any change on market behavior that can lead to a new trend.
The current rally in gold & silver is but one of many steps in a bottoming formation. Each successive step confirms the one that came before. The next step will be to watch the next downward reaction to see how it unfolds in order to assess the significance of the rally over the past two weeks…[The original article as written by Michael Noonan (edgetraderplus.com) is presented here by the editorial team of munKNEE.com (Your Key to Making Money!) and the FREE Market Intelligence Report newsletter (see sample here – sign up in the top right corner) in a slightly edited ([ ]) and/or abridged (…) format to provide a fast and easy read.]