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The odds of being able to buy physical gold and silver at current levels diminish with
each passing month. In terms of pricing for buying physical precious metals, we are more than likely looking at the lows. The timing for buying and holding as much gold and silver as you can will not be much better than at current prices for a few generations. The fiat game has run its course. In articles over the past few weeks [see here and here] we said there is no evidence of a change in trend. That was the last few weeks. This week is different. [Let me explain why in words illustrated by a number of charts.]
So writes Michael Noonan (edgetraderplus.com) in edited excerpts from his original article* entitled Gold And Silver – Newton’s Third Law Is About Ready To [Over]React. Be Prepared.
[The following article is presented by Lorimer Wilson, editor of www.munKNEE.com and the FREE Market Intelligence Report newsletter (sample here – register here) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. This paragraph must be included in any article re-posting to avoid copyright infringement.]
Noonan goes on to say in further edited (and in some instances paraphrased) excerpts:
[Over the past few months] JP Morgan, in concert with others, has been…suppressing the paper market by naked shorting tens of thousands of contracts…[in an effort to] scare everyone out of the gold and silver market. It worked, in a small part, pretty much destroying the futures market, yet it failed on a grand scale by attracting world-wide pent-up demand for bargain prices!The natural law of supply and demand has been unnaturally distorted, and the fiat buzzards are about to have their paper asses handed back to them, with their heads still up there. The final push to keep PM prices artificially low has created such a tightly coiled spring that once the pressure lets up, or is forced up, the reaction is going to push gold and silver to levels unknown that will be equal and opposite to the misplaced energy keeping them down [thanks to the effects of Newton’s Third Law Of Motion which states that to every action there is always an equal and opposite reaction….
Leave to central planners to convert the Law Of Supply and Demand to “Unintended Consequences”! All government, Keynesian, and central planner idiots have abused Newton’s Third Law Of Motion profusely, and at the expense of the masses, throughout history. Every once in awhile, though, it catches up to them and we stand fortunate enough to be the beneficiaries.
Let no one ever forget that the Fed, a privately held corporation NOT under US control, (but in total control of the U.S.), was modeled after the Weimar banking system. The Weimar banking system was designed for one purpose and one purpose only, to enrich the bankers at the expense and destruction of the German economy. Mission accomplished.
The Weimar banking system was imported to this country in 1913, when the Federal Reserve Act, a mirror of the Weimar banking system, was passed. The privately owned federal reserve was established for one purpose and one purpose only, to enrich its owners at the expense of the U.S. economy. “Mission accomplished,” as Bush Jr. would say.
None of this matters, any more. Either you see the handwriting on the wall or you do not. Can there be yet one more push to the downside in PMs? Yes. Will there be? The odds of that suicidal banker event diminish with each passing day. Do not play Russian roulette with the timing of your purchases, anymore. In fact, the Russians, (and the Chinese, and the Indians, and the Turks, and the Arabs) have been the willing beneficiaries of this blatantly stupid move by Western central bankers to scare people away from owning precious metals.
As far as the futures and their artificial prices are concerned, the bear market is starting to fray around the edges. For the first time in months, we opted to go long gold in futures. It may be just a short-term trade, but the signal to buy was clear. Futures have not signaled a definitive bottom, but we are of the solid belief that the physical market may soon become the more accurate pricing mechanism.
Below is this week’s update of the charts:
Gold – Monthly
There is one trading scheme that calls for a buy and hold whenever price rallies and closes at the highest level in a four-week period. That is a mechanical process, but one for which we have some degree of respect within the context of developing market activity.
It is no accident that gold was able to rally as strongly as it did , and have that rally fall in line with the 4 week higher close scheme. It is something we will continue to watch.
Gold – Weekly
Last week’s call for buyers absorbing the effort of sellers, just under 1300 was spot on. Once price rallied above that area, it did so on strength not seen for some time in the gold market. We recommended buying, as stated in the chart comments. [Read:
It is possible that another level of absorption may be forming, in the second box. Price activity will confirm or negate that, possibly next week.
Gold – Daily
The argument for silver is not as compelling, chart-wise, as illustrated below.
Silver – Monthly
It looked like silver was signaling earlier than gold, in the past month, and note was made of its high volume, strong close, at the end of June, similar to gold fourth chart, making several observations about it [see here].
Silver – Weekly
Will gold pull silver up, or will silver act as a drag on the current rally in gold? Each has to be viewed separately for decision-making purposes. Right now gold is favored, and it would be a mistake to buy silver over gold in the hopes it will catch up. Buy silver futures when developing market activity signals a buy, as occurred in gold. We choose now for buying and holding physical gold and silver. We are on the long side in gold futures, but that can change on any given day.
Silver – Daily
Conclusion
The window of opportunity to buy physical gold and silver continues to narrow. Like the housing market top was known to be coming, when it came, those who waited too long regretted it. When the bottom for the physical PMs is known as a certainty, those who waited for a “better price” may also regret that decision. It is all about choice.
[Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.]
*http://edgetraderplus.com/market-commentaries/gold-and-silver-newtons-third-law-is-about-ready-to-overreact-be-prepared
Related Noonan Articles:
1. Noonan: NO Evidence of Change in Downward Trend In Gold & Silver…Yet
July 20, 2013 3 Comments
You will read more and more articles touting how gold and silver have bottomed. They have not, at least according to price behavior as determined by actual buyers and sellers in the market. Read More »
Charts speak the loudest…and they never lie…[because they are] the true record of all buy and sell decisions executed, coming from the most informed to the least informed. Most of the problems lie with those who form an opinion, and how they choose to impose it onto what any given chart “says.” My understanding of what the quarterly monthly, weekly and daily charts are conveying about the price action of silver is, simply,] “Silver stackers, these lower prices are a gift you should keep on taking. Stay tuned.” Read More »
3. Noonan: Charts Suggest NO Ending Price Action In Either Gold or Silver – Take a Look!
June 21, 2013 1 Comment
Not one Precious Metals guru has gotten anything right in the last 18 months. All have been calling for considerably higher prices. Over the past several months none called for sub-$1,300 gold and sub-$20 silver. Crystal balls do not work and never have. When it comes to markets, anything can happen [but the charts convey that] there is no apparent ending action suggesting a selling climax or even a cause for a reaction rally. Take a look. Read More »
4. Charts Provide Certainty – Not Opinion: Here’s What They Say About Gold & Silver
Charts provide certainty, for they are absolute and the final word at the end of day, week, month, etc. There can be no dispute over a bar’s high, low and close, plus the volume, for whatever the time period under consideration. There is a high degree of logic within them and, while there can be differences of opinion over their interpretation, establishing a fixed set of parameters can mitigate most any potential dispute. So just what are the charts saying about the current trend in gold and silver? Let’s take a look. Read More »
5. Gold & Silver Rules of Engagement: IF This Happens, THEN Do That – Here’s Why, Here’s How
Never go against the market. It does not matter what your beliefs are…It does not matter what the fundamentals are either. [What matters] is the TREND! Once you know the trend is up you need a game plan on how to participate from the buy side and when the trend is down, a plan ion how to participate from the short side. If there is no trend, then the odds are not favorable for either game plan.[So exactly what are the charts saying about the trend in gold and silver these days? Read on!] Read More »
6. Gold & Silver: Don’t Wait for the Bottom – “Average Down”. Here’s Why
You cannot control what others do, especially those in power. You can control what you do. Just keep buying, regardless of price, because if/when the price of gold and silver were to go lower, you may not be able to buy. If/when the price of gold and silver were to go higher, it may be at such an accelerated rate that any price in the past few years seem cheap. Words: 550 Read More »
7. The Best Article On “What Happened to the Price of Gold & Why?”
Everyone personally holding physical gold and silver, as we have been recommending, has no margin call to meet and no reason to sell. This is a temporary situation, and it will pass. Now is not the time to panic, as that is the intent of the central planners/bankers in forcing gold and silver through strong support levels. Stay the course. To the extent you can, continue buying the physical metal. Read More »
9. Gold & Silver: Go “Get” While the Getting is Good! Here’s Why
There will come a time, and based on current charts no one knows when, that prices for gold and silver will become prohibitive and/or governments will do what they can to inhibit (steal) ownership, maybe even making it criminal to own or use in transactions. [That being the case we advocate that you go “get”] physical gold and silver [while the getting is good], consistently and at any price. The point here is not to “make money,” but to preserve and/or create wealth. [Let me explain.] Read More »
10. Spend Your Bernanke Bux Now on PHYSICAL Gold & Silver! Here’s Why!
If Venezuela were any guide, we would have to say “Buy gold and silver, right here, right now!”…For those of you who hold Bernanke Bux, aka fiat paper, pay close attention. Those Venezuelan citizens who held paper Bolivars took a 46% hit on their purchasing power. Those citizens there who held gold and silver saw an equivalent 46% jump in their holdings. If you think it cannot happen here, you are wrong. It already has. Words: 295 Read More »
11. Gold & Silver vs. Fiat: Do You Live In An Imaginary World Or In Reality?
12. Gold & Silver Are the Achilles Heel of the Largest Ponzi Scheme – Ever! Here’s Why
From a weak (pun intended) ago:
There are now too many other BIG fiscal “players” in the global marketplace for the USD to continue to stay THE worldwide standard forever; and when little by little deals are made in other currencies, the USD will begin to slip at which time PM’s and their value vs. the USD, will also change dramatically in what I call the upcoming US Dollar Tipping Point.
Depending upon what causes the shift in the USD’s value (a War vs a new ongoing resource transaction for oil sales), PM’s value will respond accordingly! Think of this as a One-Two combination fiscal punch that will leave those holding only USD reeling, while at the same time only those still holding PM’s will remain much more secure than ever before.
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I believe the practice of selling naked shorts (buying Gold with freshly printed paper money) is what is responsible for the current low prices of Gold. Too soon investors will wise up, probably due in part because other Countries Central Banks are now using their own paper USD to purchase Gold (and other PM’s), which will then lead to the value of the USD reversing its current upward trend!