So far this week, I have made two large gold purchases. It is possible that gold could drop to $1,350 but with the current price ABOVE the 200-day moving average, which I have been waiting for, the funds should come back into the market to support a move toward $2,000. I am convinced that $4,500 (absolute minimum) is in the cards, so buying around $1,600 with a downside of maybe $250 and an upside of at least $3,000 is an easy decision for me to make. Assuming that gold holds above $1,610 for the rest of the week, I have a lot more money on the sidelines that will be invested in gold – much of which will be stored in an insured and segregated account with our Miles Franklin International Precious Metals Storage Program. At THIS TIME, I favor gold to silver because if gold does drop, silver will fall harder and could drop by one-third. Note I said “could,” not would. Down the road, I will probably re-balance and “trade” some gold for more silver, but for now, it’s gold and more gold.
Here is the most important information I have given you all year! It is a game changer for gold. If true, the bottom is in and let the rush to $2,000 begin.
King World News is a first-class source of information. Their guests are the “who’s who” in gold and silver including Jim Sinclair, Richard Russell, Eric Sprott and Jim Rickards. We must assume that Eric King’s “London Trader” is a credible source. If the following information is correct, it means the end of the gold manipulation is here, now. Without the bullion bank “leasing” and the leveraged short selling that takes place on Comex, gold will reach its equilibrium free market price. And it will occur in short order. That price, in my estimation is above $2,500 and this will not be the top. This will launch gold into its long-awaited third and final stage in its once-in-a-generation bull market. Where will this end? I really don’t know, but you can pick your own ridiculous price. As Jim Sinclair says, people won’t believe how high the price of gold will go.
London Trader – We Are Witnessing a Historic Bottom in Gold – King World News
Even as I write this, gold has suddenly reversed course, having moved up from its low of $1,570 last week. Something is causing this sudden and unexpected turn-around. Could it be the huge new physical demand, implied by the following interview? Check out the following 3-day gold chart. Note that on the left of the chart the lines are rising each day. That is the PHYSICAL market in the Far East, before the paper manipulation start up after 8:00 a.m. in New York when the bullion banks show up for work. Watch this trend very closely. If it continues, through the New Year, then prepare for at least three years of golden fireworks!
In case you missed it yesterday, there were two topics that were covered by the Aden Sisters – ETFs and the correction in gold. They favor physical ownership of gold over the ETFs and they see the current pullback as a normal “D” wave decline with very strong 65-week moving average price support at $1,625, which would amount to a 20% decline, quite normal in a bull market and certainly nothing to worry about. Their conclusion is “Gold is oversold and this is still the time to be buying and accumulating during (this current) weakness.
Warren Bevan (Precious Metals Stock Review) is going through the same kind of thought process I just went through, but he came to the opposite conclusion. He says:
I’m seriously considering dumping some physical gold and silver and allocating that cash to the mining sector but to be honest I’m scared to do that.
The physical metals are just that, while the shares are much more volatile and less secure but the payoffs could be huge.
It’s a never-ending tug of war in my brain this holiday season and one that is unlikely to end and give me peace in the near future.
It’s just such a tough thing to sell physical precious metals and get fading currencies as the future of said currencies is far from certain.
I took the opposite stand and sold nearly all of my precious metals share, which have underperformed for the past 10 months and the funds are being carefully allocated back into physical gold and silver. Naked shorting of the shares is running rampant. Dollars that once would have gone into mining shares are being siphoned off by GLD and SLV. The same could be said for physical gold and silver, here in the US, but central banks and increased buying coming from India and China have more than made up for the loss to the ETFs.
It really all comes down to but one thing, sleep. You have to be able to sleep at night, comfortable with your investments. For me, my comfort level is highest with physicals. Many of you are more comfortable with mining shares and ETFs. Any of these choices are much, much better than staying out of the market.
Along with the Aden Sisters, Warren Bevan is not concerned by the pull back in gold. He says:
Gold was smashed 6.58% for the week but held support at the $1,550 area. The drubbing is harsh right now but it’s not the first time we’ve experienced it, nor will it be the last in this secular bull market that has years to run still.
We really need to zoom out and look at a weekly chart to give us a better view.
As gold broke the 200-day moving average this past week we saw a large influx of commentators proclaiming the end of the gold bull market and that’s fine by me. There were to many bulls anyhow.
The facts are that we’ve broken the 200-day average before and seen the same routine every-time. The world is much worse off economically than the previous times and the debt issue simply cannot be solved. There literally isn’t enough money in the world to pay off the debts….I can hear the printing presses warming up now!
Personally, gold can fall quite a bit from here and I won’t worry since I’d much rather own coins than to be fully exposed in the stock market, or worse yet sitting in depreciating cash.
It’s all a ruse; don’t fall for it. Take advantage of the Christmas gift of cheap physical gold and silver soon.
It’s how your deal with adversity that determines how successful you’ll be and it’s near a great time to do some serious buying of high quality mining stocks.
Right now with the holidays in full swing anything can happen with gold and we could well see a move to $1,425 or so and it wouldn’t really mean much other than gold is cheap for us all.
Larry Edelson was out scaring his readers on Monday. He wouldn’t be surprised to see gold test $1,425. He is still very bullish, long-term, but for the short-term, he expects gold to go still lower.
Anything is possible over the next few weeks. First things first – let’s see if gold can rise above its 200-day moving average, now sitting around $1,610. (Since I wrote this, gold has smashed through its 200-day MA!)
The folks over at High Tech Research Tools look at the current price range as a “buy,” and rather than wringing their hands over the recent breach of gold’s 200-day moving average, they present the following comments from Tyler Durden, author of Zero Hedge:
For the first time since January 2009, gold closed below its 200-day moving average on Wednesday. Today’s Chart of the Day puts Wednesday’s -2.8% violation of this long-term smoothing line into perspective, by comparing it to the average violation of both the general and upward sloping 200-day average since 1999.
The slope of a moving average is something that many analysts fail to address when trying to determine potential turning points on a chart. Although gold has been working lower for more than 3 months now, the current upward slope of the 200-day line reinforces the fact that gold’s long-term trend is still to the upside.
If we simply consider the general direction of the 200-day moving average since the start of the yellow metal’s secular bull move in late 1999, gold’s average distance below this line is -3.70%, with a maximum undercut of -19.2%. On the other hand, if we only consider gold’s performance when the slope of the 200-day line is higher, the average violation is -2.19%, with a maximum undercut of -10.8%.
And SMRA’s short-term price implication conclusion:
On its own, gold’s -2.8% violation of the 200-day line on Wednesday has already surpassed the average violation dating back to 1999. Short-term, this is just one reason we see strong potential for a rebound as participants reduce short exposure.
Lastly, absolutely none of this matters one iota when the central banking cartel resumes printing.
Finally, for those of you who may have missed it, or do not read our own Ranting Andy Hoffman’s afternoon Rants, here is the world as viewed from Ranting Andy’s perch.