Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Now is the Time to Short Gold and Silver

Commodities / Gold and Silver 2015 Oct 18, 2015 - 03:33 PM GMT

By: Submissions


Tony Mermer writes: Gold's recent rally has convinced many investors and traders that the precious metals bear market is over. I disagree. Since I believe that the gold and silver bear markets are not over, the recent rally is merely a rally within this bear market. This rally is probably over, so here's why now is the time to short gold and silver.

This rally is becoming old

Gold has rallied since the middle of July 2015 when it reached $1070. This means that the rally has already lasted more than 3 months. Historically speaking, gold's bear market rallies do not last more than 3 months.
  1. Gold's rally from early November 2014 to mid January 2015 lasted 2.5 months.
  2. Gold's rally from January 2014 to mid-March 2015 lasted 2.5 months.
  3. Gold's rally from late June 2013 to late August 2013 lasted 2 months.
  4. Gold's rally from May 2012 to October 2012 lasted 5 months.
  5. Gold's rally from December 2011 to February 2012 lasted 2 months.
  6. Gold's rally from September 2011 to November 2011 lasted 1.5 months.
As you can see, each rally within this bear market lasted no more than 3 months, with one exception. The one exception - the rally from May to October 2012 - can easily be explained. Although gold's absolute bottom was in May 2012, it essentially made a flat bottom from May to August. Thus, the real rally in that case only lasted 2 months. if recent history is any example, the current gold rally should not continue much farther.

Gold and silver are up against a ton of resistances

Gold and silver are rallying up against a bunch of resistances. Any breakout above these resistances is likely to be a false breakout. Silver is running up against it's 200 sma. As you can see, the 200 sma has been admirable resistance over the past 2 years.

Gold is also running up against its 200 sma resistance. Is it making a false breakout? Perhaps.

In addition to the moving average resistances, precious metals related assets are running up against some long term resistances. Silver is facing resistance from its long term trendline. This trendline has capped silver throughout this entire bear market.

Likewise, the gold miners ETF GDX is facing resistance from its long term trendline. This trendline has capped GDX throughout this entire bear market.

The U.S. dollar is ready to rally

The U.S. dollar's bull market is not over. All bull markets have at least 2 rallies, and the USD's rally from mid-2014 to early 2015 was only the first rally in this bull market. Thus, the U.S. dollar's bull market has at least one more rally. The U.S. dollar has been in a long correction since March 2015. In other words, this 7 month correction is about as long as corrections get. The U.S. dollar is ready to rally to new highs any day now. In addition, the Euro is very close to retesting its August 2015 high of $1.17. Should this resistance hold, the U.S. dollar's bottom will be in. A bullish U.S. dollar is bearish for gold, silver and gold mining stocks. After all, it's the U.S. dollar's rally that caused precious metals related assets to decline from the middle of 2014 to the end of 2014.

By Tony Mermer

I'm Tony Mermer, founder and CEO of Investing Track ( We are a privately held quantitative investment firm.

© 2015 Copyright  Tony Mermer - 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