Best of the Week
Most Popular
1.BrExit Looks Set to Win EU Referendum, Final Opinion Polls Give LEAVE Lead Over REMAIN - Nadeem_Walayat
2.BrExit Morning - New Dawn for Britain, Independence Day! - Nadeem_Walayat
3.LEAVE Wins EU Referendum - Sterling and FTSE Hit Hard, Pollsters, Bookies and Markets All WRONG! - Nadeem_Walayat
4.BrExit to Save Europe from Climate Change Refugee Migration Apocalypse - Nadeem_Walayat
5.Trading BrExit - Stocks, Bonds, Sterling, Opinion Polls, Bookmaker Odds and My Forecast - Nadeem_Walayat
6.EU Referendum Latest Opinion Polls Show LEAVE Halting REMAINs Surge - Nadeem_Walayat
7.Gold And Silver – Insanity Is World “Norm.” Keep Stacking! - Michael_Noonan
8.Trading BrExit - British Pound Plunges, FTSE Stock Futures Slump on LEAVE Shock Referendum Win - Nadeem_Walayat
9.Gold And Silver: Security, And BREXIT - Michael_Noonan
10.BrExit Vote - "The Trend is Set" -- And What You Should Pay Attention to Next - EWI
Free Silver
Last 7 days
Stock Market Rally Runs Out of Steam - 29th June 16
Rapid Growth:The Financial Trends Of Online Gaming - 29th June 16
FTSE and Sterling Brexit Trading, Deconstruction of the EU Referendum Result - 29th June 16
Stock Market Bounce May be Over - 28th June 16
Stock Market Meltdown Likely to Drive Gold Towards $1,500 - 28th June 16
Brexit Victory over the EU Globalists - 28th June 16
Brexit Psyop: Greenspan Falsely Blames the Brits for the Crash and Chaos to Follow - 28th June 16
Greenspan Calls Brexit a ‘Terrible Outcome’ as Euro Area Tested - 27th June 16
Stock Market SPX Below Mid-Cycle Support - 27th June 16
Best Holidays for Summer 2016 - 27th June 16
Another Stocks Bear Market? - 27th June 16
BBC EU Referendum Result Highlights - YouGov, Markets, Bookmakers, Pollsters ALL WRONG! - 26th June 16
Investors Map Post-Brexit Strategies Amid Global Market Upheaval - 26th June 16
Gold Price Weekly COT Update - 26th June 16
First the UK, then Scotland ... then Texas? - 26th June 16
Stocks Bear Market Resumes or Just More Noise - 26th June 16
Gold And Silver: Security, And BREXIT - 25th June 16
Dow, Euro & Brexit Recap - 25th June 16
Resistance Holding Gold Stocks after Brexit - 25th June 16
Venezuela vs. Ecuador (Chavismo vs. Chavismo Dollarized) - 25th June 16
Gold, Silver And PM Stocks Summer Doldrums Risk - 24th June 16
Here’s Why China “Economic Hard-Landing” Worries Are Overblown - 24th June 16
Jubilee Jolt: Markets Crash, Gold Skyrockets as Britain Takes Brexit - 24th June 16
BrExit Morning - New Dawn for Britain, Independence Day! - 24th June 16
LEAVE Wins EU Referendum - Sterling and FTSE Hit Hard, Pollsters, Bookies and Markets All WRONG! - 24th June 16
Trading BrExit - British Pound Plunges, FTSE Stock Futures Slump on LEAVE Shock Referendum Win - 24th June 16
EU Referendum Shock Results Putting BrExit LEAVE in the Lead Hitting Sterling Hard - 24th June 16
Final Opinion Poll Gives REMAIN 52% Lead, Bookmakers, Markets and Pollsters ALL Back REMAIN Win - 23rd June 16
Does BREXIT Matter? Outlook for Sterling - 23rd June 16
Keep Calm and Vote BrExit - Last Chance to Break Free of EU Superstate - 23rd June 16
Here’s the Foreign Policy Trump and Clinton Really Want - 23rd June 16
Details Behind Semiconductor Stocks Leadership - 23rd June 16
Trading BrExit - Stocks, Bonds, Sterling, Opinion Polls, Bookmaker Odds and My Forecast - 23rd June 16
BrExit Looks Set to Win EU Referendum, Final Opinion Polls Give LEAVE Lead Over REMAIN - 22nd June 16
Proof that the Gold Bears are Wrong - 22nd June 16
Here’s a Trillion-Dollar Investment Opportunity for Those Few with No Debt - 22nd June 16
BrExit to Save Europe from Climate Change Refugee Migration Apocalypse - 22nd June 16
Increase In U.S. Rig Count Will Not Cap Oil Prices - 22nd June 16
Are Copper and China Stocks Set to Rally? - 22nd June 16
SPX May Break Its Trendline - 22nd June 16
Believe it or Not: More Kids Live At Home Now than Since The Great Depression - 21st June 16
EU Referendum Latest Opinion Polls Show LEAVE Halting REMAINs Surge - 21st June 16
British Pound Outlook - BREXIT, Europe and You - Does your vote matter? - 21st June 16
Fascist Victory Behind the European Union - 21st June 16
EU Referendum Opinion Polls Analysis Shows Strong Momentum in REMAINs Favour - 21st June 16
Is It Time to Dump Gold and Buy Platinum? - 21st June 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Market Volaility

Gold and Silver Enhanced Investor Opportunities Loci

Commodities / Gold and Silver 2013 Feb 24, 2013 - 12:29 PM GMT

By: DeepCaster_LLC

Commodities

“Plus ça change, plus c’est la même chose.”           French Wisdom Nugget

 

“Federal Reserve Policymaker’s late last month expressed explicit and detailed squeamishness over their monetary stimulus, which might be scaled back sooner than the Fed’s own guidance suggests, according to Minutes released Wednesday.” (emphasis added) IBD, 02/21/13

 

All Investment Cognoscenti know that The Fed’s “Communication Policy” is aimed at Financial and Market Ends, not at Truth. (Here, should we rely on The Fed’s earlier expressed “Guidance,” or this week’s “Scaling Back” Hint? They can not both be True.)


Indeed that Policy could well be paraphrased “Tell whatever Lie you need to, to achieve your Goals.”

 

Those recently released Minutes, for example, achieved a Primary Fed Goal of blowing the Gold and Silver Prices down through Major Resistance, and a Secondary one of cooling somewhat inflated Equities and Commodities Prices.

 

As leader of The Cartel (Note 1) a Cornerstone of The Fed’s Policy is, and has long been, to suppress Gold and Silver Prices, lest they further devalue their Fiat Currencies and Treasury Securities, and so they will not alarm the Hoi Polloi about the intensifying Price Inflation (e.g., 9.24% in the U.S. – Note 2) which their Ongoing Monetary Inflation is increasingly producing.

 

But The Fed’s (and other Central Banks’) ongoing Monetizing and Dissembling creates Enhanced Investment and Trading Opportunities in Several Sectors.

 

Consider Gold and Silver

 

Extraordinarily low levels of Fear (reflected in an ultra low VIX), plus increasing (but unjustified) Bullish sentiment for Economic strength reflected by MSM Talking Heads, is facilitating Cartel success, for many weeks now, in keeping the P.M. prices (save Platinum) trending down to the bottom of trading ranges, and, now, below.

 

Just as we earlier Forecast The Cartel took advantage of the Lunar New Year to drive down P.M. prices. Thus Gold and Silver have traded down to and through Major resistance.

 

Unfortunately for us Precious Metals Partisans already holding positions, The Cartel has succeeded in breaking Gold down below its 50 and 200 Day Moving Averages – very Bearish short-term.

 

JBGJ confirms The Cartel’s recent successful Bear Raid:

 

“The CME Final for Friday confirms that volume was 283,225 lots. 4.7% above estimated. This means half the day’s volume was done in the 8am-9am period.

 

Open interest only rose 854 lots, 2.66 tonnes or 0.19%, to 445,413 lots. (The Preliminary had indicated 1.04%.) Nevertheless, any increase on a day in which gold was down 1.71% at the floor close, 1.63% at the stock market close and sustained so much technical damage is remarkable. Friday was a monster Bear raid.”

 

“Friday O.I. Increase Confirms Friday Major Bear Raid,”

John Brimelow, JBGJ, 2/19/2013

 

 

And The Fed’s Minutes (hinting at possible “Tapering” off of QE) released this week administered the Coup de Gras with the result that Gold and Silver have broken down through Major Resistance at $1600 and $30 respectively, The next Major Resistance is $1535ish for Gold and $26 to $27 for Silver. Given the breakdown we would not be surprised to see these P.M.’s taken down to these levels, short-term.

 

We reiterate however that, we expect these levels to be temporary because The Cartel is having increasing difficulty holding three P.M.’s down, given the unrelenting demand for Physical, especially Physical Silver.

 

In other words, Gold and Silver are likely still participating in the completion of their bottoming process and The Fed’s Action has created an Enhanced Buy Opportunity.

 

Thus, there continue to be increasingly Excellent Buying Opportunities at these levels in both the Bullion and the Shares and especially in Silver.

 

A similar Opportunity, but in Reverse as it were, exists in Equities.

 

Fed (and other Central Bank) Money Printing has kept Equities afloat on a Sea of Liquidity, resulting in an Artificial Rally, i.e., one not founded on Fundamentals.

 

But the slightest Hint of decreasing Fed support, such as in The Fed Minutes, gives the Equities Markets Serious Trouble, Trouble which Establishment Newsletter Writer, Dennis Gartman, has recently labeled a “Tectonic Shift”.

 

The Stock Rally which began last November reminds us that Stock Prices can stay divorced from Fundamentals for a long time. And, fundamentally, the OECD (Developed) Nations’ Economies are still Shrinking. The USA’s Real GDP is already a Negative -2.20% per shadowstats.com.

 

So it is no surprise that the Top of this Artificial Rally (yet to arrive) would complete the Ominous Hindenberg Omen Pattern, and that that top will likely be followed by a cataclysmic multi-leg, multi-year crash—the impending Mega-Move of which we have spoken, and which we think is highly probable.

 

We emphasize this scenario is consistent with the Real Numbers. For example, just 4.9% of the companies which have reported have raised guidance. This is the sixth quarter in a row in which more companies have lowered guidance than raised it and that is the Trend – ever lower earnings guidance, which signals lower Equities Prices dead ahead.

 

Moreover, the Economic Fundamentals including Debt Saturation, Ever Higher Unemployment, and Economic Stagnation, including the OECD’s outright contraction referenced above, have not disappeared, but have, overall, worsened.

 

Thus, we reiterate: it is  very important to bear in mind that the Equities Markets are not being impelled upward on Fundamental Strength but rather on The Fed-provided (along with other Central Banks) Tide of Liquidity… and that is a Dangerous Situation which will likely lead to a Crash.

 

This is what the multi-year Hindenberg Omen Chart Pattern is telling us.

 

But this eventually will provide us with Great Opportunities to Profit on the Short Side, when the time is Right, a Time which we forecast in our latest Alert, “17.97% Yield Buy Reco & Remarkable Forecasts: Equities, Gold, Silver, U.S. Dollar/Euro, U.S. T-Notes, T- Bonds, & Interest Rates, & Crude Oil” post in ‘Alerts Cache’ at deepcaster.com.

 

Similar Short side Opportunities exist in the $US and U.S. Treasury Securities over the long term, where The Fed is creating The Mother of All Asset Bubbles.

 

The $US Moving Averages Chart has recently generated a “Death Cross – the 50 Day Moving Average has crossed below the 200 Day Moving Average. Not good, but not surprising, given The Fed’s ongoing $US Destruction Derby.

 

The $US Action since mid-November (and notwithstanding the recent pop up) appears to be the first leg down of what will become the long-term trend we have earlier forecast – the Destruction of the $US as the World Reserve Currency, and its replacement by a Gold-backed Yuan.

 

In sum, the $US Action since November is the beginning of a chopping long term down trend for the $US, interrupted by spikes up (as we are seeing this week) on Eurozone weakness and/or an Equities Crash, and/or Risk-off Moves.

 

Indeed, there is an increasing Threat of that Massive Sell-off in the U.S. Dollar, especially vis-à-vis Real Physical Assets, beginning any time in the next very few months notwithstanding what the Central Banks do; that is because of The Orgy of Fiat Currency Printing The Fed (and other Central Banks) is unleashing, coupled with increasing and unpayable U.S. Debt.

 

That is, The Biggest One, Rising Interest Rates aka The Bursting Treasury (and other) Bond/s Bubble, has just begun, as we earlier Forecast. It is no secret that yield on the U.S. 10-year has shot up over the past few days and is now bouncing around 2%.

 

Thus $US Treasuries will offer an excellent short play as well provided the timing is right.

 

In sum, even though Fed (and other Central Banks) Policies are quite destructive to U.S. National Economic health (as well as to the health of other Nations, and to Individuals, such as Savers and Retirees) via Inflation, The Fed’s Money Printing does offer Opportunities for The Prepared.

Best regards,

www.deepcaster.com
DEEPCASTER FORTRESS ASSETS LETTER
DEEPCASTER HIGH POTENTIAL SPECULATOR
Wealth Preservation         Wealth Enhancement

© 2013 Copyright DeepCaster LLC - 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.

DEEPCASTER LLC Archive

© 2005-2016 http://www.MarketOracle.co.uk - 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

Catching a Falling Financial Knife