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Why 95% of Traders Fail

Silver Price – The Power Of Thought Will Ultimately Previal

Commodities / Gold and Silver 2014 Jan 19, 2014 - 03:07 PM GMT

By: Michael_Noonan

Commodities

It has become universally recognized that the power of thought can change anything.

Silver remains incredibly undervalued, and that bodes well for all of us silver stackers. The fact that silver and gold have purposefully been suppressed by the moneychangers makes the future for the next price rise to be greater than ever. Any time anything has been artificially manipulated, it makes the ultimate outcome far worse than was planned by those doing everything possible to prevent a rise in prices. Central planning always fails.


Do not mess with Mother Nature! The natural law of supply and demand will always rise up from under the distorted efforts to contain it. The good news is that each passing week brings silver closer to its inevitable resolve: a powerful rally that will surpass all others.

In our gold article, Disconnect Between Fundamentals And Price. Perception Rules, we addressed the importance of perception. Beliefs are formed from perceptions, and they are not necessarily reality, but just a belief about reality. Change the perception and you change the belief.

We keep moving away from discussing fundamentals because the fundamentals have not been reliable indicators in the supply/demand equation that normally determines price. Yet, almost every single article focuses on the record sales of numbers of coins offered to the public, charts showing overwhelmingly favorable statistics that favor higher silver prices, cost factors for mine production, decreasing supply relative to increasing demand.

How many times, and in how many ways can the same information be presented over the past year, and yet the price of silver languishes near recent lows? People have an appetite for this kind of information. It serves as a crutch to bolster flagging belief that silver and gold will rally any time soon.

From our perspective, we are looking at one of the best opportunities to be buying the Precious Metals, [PM], in our lifetime. Okay, second best. Those who have been buying since $4 and $5, and up, deserve recognition for knowing far better that silver stacking was, and continues to be the right thing to do.

Fundamentals are real. We are not being dismissive of their importance. Instead, we see the perception of their impact as being misplaced, for now. Ultimately, they will prevail, but the greater area of focus of a failed fiat financial system deserves center stage. It is the gross distortion of paper fiat being forced-fed down the throats of the public and sovereign governments, like a goose being prepared to produce foie gras, that virtually guarantees the price of silver, and that of gold will rise to appropriate levels that reflect the degree of manipulation over the past few years.

It is hard to imagine that the elites may have miscalculated so badly, but that is a distinct possibility. Perceptions of the elites and their New World Order, as controlled by their central banking system and determined by the Rothschild Formula, [Give me control over a nation's money, and I care not who makes the laws], has always been to see them as impregnable.

Could it be that their success over the past few hundred years, unopposed, has led them to become susceptible as a consequence of their own arrogance and their own perceived sense in invincibility? We do not know, but it was a thought that was unthinkable in the past recent years.

Thoughts are ideas. They do not exist in physical form, yet they have been proven to manifest themselves into the physical world throughout history. Marconi, Einstein, Gandhi, and so many others transformed a thought that impacted the world. The power of one lives on.

Three years ago, the irreverent Max Keiser exhorted people to ”crash J P Morgan by buying one silver coin.” It has not worked, obviously, but his idea is spot on, and the notion to keep buying silver and gold coins may not overturn the effort of the elites, but it will have a dramatic impact on the individuals who have taken the right steps to buy and hold PMs as the best form of protection against the financial ravages that are sure to result from the miscalculated arrogance of the elites.

Who, growing up in America, would have ever thought that it would be China and Russia that could suppress the suppressors? The most coveted prize of the Rothschild formula was to own all the gold, following the dictates of the Golden Rule, and rule they have, but their days may be numbered.

There are always unintended consequences when the laws of nature are misused. The elites never imagined their artificial suppression of the people of the world could ever come back to haunt them. They still maintain a stronghold on the Western world, via the Federal Reserve in America, and the all but failed European Union, as they continue to wreak financial havoc on country after country. Even the stalwart Germany may soon turn its back on the elite’s puppet bureaucrats running the show over there.

Consider: the rebuke to Germany in refusing to return their own gold, German citizens tiring of the idea of financially supporting other financially failing Euro countries, even the not so petty spying on Angela Dorothea Kasner Merkel, German Chancellor and turncoat architect for the elite’s formation of the European Union to subjugate Europe’s citizenry under one convenient umbrella of control, may have added to the tipping point for potentially turning Germany to the East, where the money and the future financial and energy power is.

So, change your beliefs and, in turn, your perception of reality, and stay focused on buying, holding, and not letting go of any acquired silver and gold in the realization that your action of one will help bring about the demise of the New World Order imperialism being so willingly advanced by the Obamas and Merkels of the world. The UK has always been a pivotal player in NWO subjugation.

There is no hope for Obama. He is controlled by the elites and in control of a badly leaking financial ship that has been damaged by a huge fiat iceberg, as it were. Merkel, on the other hand, has a choice. If she does not change, external events will force the change upon her. The UK will never change.

We acknowledge the COMX-derived charts of the paper derivatives of the actual physical silver market are controlled by the central bankers, but it is all we have. Plus, throughout history, there has always been some degree of manipulation over all markets. It is human nature to go against Mother Nature.

To the charts…

Silver may be the one to watch for 2014. It is likely to outperform gold because the gold- to-silver ratio is so high, currently just under 62:1. Reversion to the mean, which is nearer to 28:1, strongly supports this idea. This is a fact and not a perception, so there is a higher degree of validity to it.

The weekly chart shows a TR, [trading range] since the April 2011 highs and lows of Sept, Dec 2012, May – July 2012, broken support 2 years later at 26 in April 2013. From the $50 highs to the $26 TR lows, over a period of 104 weeks, the downside of broken support has “only” been $7. For this reason, we likened it to a mountain in labor giving birth to a molehill. How disappointing. More downside was more than reasonably expected.

It could be that the downside is not done, that more is yet to come. From a pragmatic point of view, the rally effort in July failed to reach 26, leaving behind what is called bearish spacing. It is a sign of weakness because it shows bears were confident enough to not wait and see how 26 would be retested, correctly expecting lower prices were to soon follow.

However, since that failed 4 week rally from the small TR, it has taken 18 weeks, 4 and 1/2 times longer to correct back to the breakout of the prior 4 week rally. You typically see this kind of labored retest in a bull market, not a bear market, and silver remains in a bear market.

This last event is a red flag notice for bears to either step up selling efforts or see buying efforts become stronger and eventually overtake supply.

That said, the week just ended did so on a very narrow range bar and near the highs of the past 8 weeks of trading. A narrow rally range typically means lack of demand, and that makes sense in a bear market environment. The last 4 weeks also have a clustering of closes. A clustering of closes can be a pause before the small rally attempt continues, or it can lead to a reversal of the little rally and a resumption of the main trend, which is down.

We do not have to know, in advance, nor do we need to anticipate ahead of time, or even make the common, costly mistake of predicting. Just let the market confirm its intent, and then follow along with the proven market direction.

What looked like a potential failed probe above 20.50, last Tuesday, and the two weak rally attempts on Wednesday and Thursday suggested price would pull back again. The exact opposite happened as price rallied on Friday. Whenever the market does something opposite to expectations, take note. Also, if a failed probe is going to actually fail, the market will decline away from resistance. In this instance, price has held and closed above the last two day’s of decline effort.

For the reasons just cited, and for noting during Wednesday and Thursday activity that the market seemed to hold declines, even though it did not rally higher, it seemed even then that silver could be absorbing selling efforts, eventually to go higher.

Silver is at an area of indecision within a down trend that has lost momentum. Rather than guess at what may happen, and possibly be wrong in guessing, better to wait for price to confirm its intent, and then take some action in harmony with the developing momentum.

As to the physical, keep on stacking! Let the market take is course, naturally, or with temporary interference, and do not be distracted by purposeful distractions. It is but a matter of time, history is on the side of silver, and the rewards will be well worth the patience.

By Michael Noonan

http://edgetraderplus.com

Michael Noonan, mn@edgetraderplus.com, is a Chicago-based trader with over 30 years in the business. His sole approach to analysis is derived from developing market pattern behavior, found in the form of Price, Volume, and Time, and it is generated from the best source possible, the market itself.

© 2013 Copyright Michael Noonan - 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.

Michael Noonan Archive

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