Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Boris Johnson Hits Coronavirus Panic Button Again, UK Accelertoing Covid-19 Second Wave - 25th Sep 20
Precious Metals Trading Range Doing It’s Job to Confound Bulls and Bears Alike - 25th Sep 20
Gold and Silver Are Still Locked and Loaded… Don't be Out of Ammo - 25th Sep 20
Throwing the golden baby out with the covid bath water - Gold Wins - 25th Sep 20
A Look at the Perilous Psychology of Financial Market Bubbles - 25th Sep 20
Corona Strikes Back In Europe. Will It Boost Gold? - 25th Sep 20
How to Boost the Value of Your Home - 25th Sep 20
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Will Gold GLD and Silver SLV ETF's Continue to Correct?

Commodities / Gold and Silver 2011 Jul 20, 2011 - 03:32 AM GMT

By: George_Maniere


Best Financial Markets Analysis ArticleThere’s an old saying. “What goes around comes around.” Well today President Obama held a quick press conference and announced that the “Gang of Six” had presented him a compromise plan that he felt everyone could agree on. The market immediately spiked up on the news and gold and its baby brother silver did exactly what I thought it would do. It sold off. So what goes around comes around – just usually not that fast.

Gold and silver have both had an extraordinary run and they were showing signs of running out of steam. A pull back like this is both an expected and healthy event in the bull market they have just experienced. If this is the pullback I have been predicting we will see gold move to the 150 day moving average at around $141.00 and silver will pull back to $34.00 - $35.00. If it is the correction I’ve been predicting we’ll know about it soon. As at the end of April both gold and silver were trading on “irrational exuberance” and they both encountered a stunning selloff. I conclude that the only difference today was the impetus that both metals received from President Obama’s announcement.

           I by no means want to imply that the gold and silver trades are finished, far from it. At times like this when a commodity like gold has experienced a parabolic run and broken the psychologically important $1600.00 level it is natural for institutional investors to take their profits and run for greener pastures like pork belly futures of frozen concentrated orange juice. Indeed from a contrarian point of view I see this as a very bullish indication for both gold and silver. This would lead me to believe that the precious metals trades are still engulfed by an underlying feeling of skittishness and could possibly continue to selloff. The would be very good news for my readers because I advised them to take their profits on GLD at $156.00. I reminded my readers of the teachings of Bernard Baruch who would rather sell a holding and watch it run up another twenty percent than watch it crater and lose all of his hard earned profits.

I also advised my readers to sell SLV yesterday. As I have been writing, I was still puzzled by SLV. I still had a nagging feeling that the faint of heart investors had not been sufficiently punished and I felt SLV would go back and test support at $32.50. Yesterday, I advised my readers and I sold out of my half position in SLV at 39.46. I must admit I questioned myself but as Gerald Loeb taught us, you can know everything about fundamental analysis and everything about technical analysis but in the end it’s the man who can tell which way the wind is blowing that will be successful. I trusted my instincts and sold the SLV. However to test my thesis, as an insurance policy I kept my position in PSLV and watched it close down 5% on the day.

While we enjoyed a strong market yesterday with the DOW closing up 202 points I am not buying into it for one minute. In fact I used it as an opportunity to build some cash. Yesterday Apple (AAPL) reported earnings and hit a grand slam home run. It closed at $377 and was trading over $400.00 in the after markets. This leads me to conclude that we may see yet another up day tomorrow and if we do I will be there selling into strength. The reason is that when the dust settles from these earnings reports I believe the market is going to sell off and I will have ample dry powder to put to work. These earnings reports are going to make it very difficult for Dr. Bernanke to make a case for another round of quantitative easing. I conclude that he will have to go in through the back door. We’ll call it stealth QE.

Let’s not forget that while the global corporations are hitting the ball out of the park the middle class common man is still nagged by the debt crisis in Europe, extremely high unemployment, sagging home prices, the nagging suspicion that another round of quantitative easing is just around the corner and the sad fact that despite what president Obama says until the partisan bickering is ended and some compromise is formalized we will continue to have the possible catastrophic possibility of default continue to hang over us like a dark cloud.

Please see the enclosed charts on GLD and SLV below.

           Gold could not hold the psychologically important $1600.00 level. If it continues to sell off, look for a bounce at the 150 day moving average at 141.50.

           Silver could not stay above resistance at $38.50. If it continues to sell off look for a retest of the $32.50 level.

           In conclusion tomorrow will be a very interesting day. If gold and silver continue to sell off look for a bounce to the levels to buy back in. This trade may have to reset itself before it moves higher. However, have no fears. It is not a question of if they will both go higher, it is a question of when.

By George Maniere

In 2004, after retiring from a very successful building career, I became determined to learn all I could about the stock market. In 2009, I knew the market was seriously oversold and committed a serious amount of capital to the market. Needless to say things went quite nicely but I always remebered 2 important things. Hubris equals failure and the market can remain illogical longer than you can remain solvent. Please post all comments and questions. Please feel free to email me at I will respond.

© 2011 Copyright George Maniere - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules