Gold & Silver

People are focusing on the price of PMs, treating gold and silver as vehicles for increasing in price relative to their cost of purchase and not on the reality of what the artificially suppressed market is showing. It is the reason for buying and holding gold and silver that matters. Know this: It does not matter what you pay/paid for owning physical gold and silver. Price is temporary; physical is permanent. That being said, however, a red flag is in currently in effect regarding gold & silver. Below I explain why.

Over the next couple of months everything should generally rise together but once the dollar puts in an intermediate bottom sometime in March or April, commodities and gold will move down into an intermediate correction as the stock market completes its final blow off top. After the stock market parabola collapses later this summer it will be time to put the pedal to the metal in the commodity markets, and especially the precious metal markets as the Great Inflation begins in earnest.

Both the short and intermediate term outlook for gold and silver stocks continues to be very positive. Historical analysis shows that GDX & GDXJ could rebound 100% and over 150% respectively by the end of this year. Both forecasts would be below the average of the one year rebounds following the 2005 and 2008 bottoms.

Buckle in, stay the course and be sure to remain situationally aware. Now is not the time to look away. Continue to remain patient, diligent, yet patient. February will be a very exciting and consequential month.

Charts capture the essence of timing so lacking in fundamentals providing information on how, (long or short), and when to enter, and at what price. Charts allow you to actually see how the markets are developing into trading opportunities, as well as when to avoid committing money. Below are analyses of gold and GDX (as a proxy for the relatively large cap gold producing stocks), in chart form, that may help you better understand what trades you should, and should not, take.

Obama has introduced the MyRA account and it is the prelude for eventually taking over the country’s entire pension programs, taking over all the accounts, (stealing your lifetime savings), and exchanging them for the US Treasury Bonds the Fed cannot sell to countries anymore. This is the only way the US government can cover its trillion $ (and growing) deficit spending. Got gold- physical gold?

Last fall, we said the rally in PMs would take longer than most expected. Expectations were unmet in 2013, and it is possible that 2014 may be no different... gold gives no indication of beginning a strong rally that will change the trend, any time soon and, while the next sustained bull market may well favor silver outperforming gold, silver may have to go lower before it can go higher. Let me explain why this is the case.

No matter what you hear or read about gold and the prospects for substantially higher price levels, the trend is down, exactly opposite of what you know. When you compare what you know, an opinion, with what the market is telling you, the market is a more accurate measure, however counter-intuitive it may be to your opinion, [and THIS is what the markets are saying].

There is no need to beat around the bush: junior mining stocks have bottomed. The bear market is over...The evidence is compelling and is growing by the day.

We are starting to see some subtle changes in market behavior but the trend currently remains down for both gold and silver. For those who want to grow their capital, the best time to make a market commitment is with the trend and given how no one knows how the market will correct, it is best to wait and see first what the market reveals. Below are some daily and weekly charts on gold & silver charts to show you how things are developing.