Some of my readers are also fans of Larry Edelson. I know, because they send me emails supporting Edelson’s work. I have repeatedly said he is wrong! We will not see gold fall below $1500. Recently he offered up one of the lamest excuses I have yet seen. He wrote, “If it turns out I’m wrong [which he is] about the coming moves in the markets, so be it. I’ll make tons of money anyway, and so will those following my forecasts.” What hogwash! In the same article he wrote, “Gold needs to close above that line, more specifically above my system buy signal at $1,727.70, to confirm a breakout and a new bull leg higher.” So here we are – gold closed at $1,635.30 on Friday and I expect to see Edelson issue a new bull market bulletin with little in the way of blowing it for his readers, who could have – and should have been buying gold from the lows, below $1,500 all the way up. Good job, Larry. You cost your readers, those foolish enough to listen to your nonsense nearly $200 an ounce.
As for my readers, I think you all knew better, or at least I hope you did because I was dissing Edelson’s dire predictions as was Ranting Andy Hoffman, all along. Forget the bears! They are simply wrong – this is a bull market and the name of the game is, as Bill Murphy says, “Ya gotta be in it to win it.”
Gold and silver are technically “oversold,” but markets can stay “oversold” for long periods of time. Does this rally really have legs? Yes, unless JPMorgan decides to throw their weight behind a takedown, which they often do. Or, will they sit back and wait? No one can answer this for you, but as I have pointed out in the past, it really doesn’t make a difference. Stop thinking about buying at the bottom or trading in and out. Leave that to the professionals (which you are not) and focus on the big picture and primary trend in gold and silver. Gold is in a primary bull market and is poised to finish the year well ahead of 2011, marking the 12th year in a row that gold is up at year’s end. That is a pretty remarkable record and remember, a trend in motion is your best friend. Personally, I expect this trend to continue until at least 2016 and when the bull market finally phases out, gold should be well north of $3,500 and silver well north of $100. I am being very conservative now, with these numbers.
Technically speaking, gold’s next major resistance is $1,800 and if there is a correction, gold should garner support around $1,650.
Jim Sinclair keeps hitting it out of the ballpark with his predictions. Yes, the central banks are coordinating their monetary policies (QE everywhere) and yes, it is QE to infinity. These policies are the reason the metals are soaring. Gold is the barometer of the central bank’s abuse of the money supply. Richard Russell has proclaimed loud and clear, for over a decade, the Fed must inflate or die! And so they are and so they will continue to do. That’s all you really need to know – so keep trading in your (depreciating) dollars for physical gold and silver and just sit back are relax with the knowledge that you have already won and the other 99% of the sheeple who refuse to accept the truth will suffer accordingly.
My friend, Trader David R recently told me that the Fed will not institute QE because they understand it is a foolish thing to do and it won’t work. I told him that I respectfully disagree and that they will continue because they have no other choice. Looks like I am right on this one. David R’s response to me on Friday was:
This is just amazing…. such fiscal irresponsibility! Politicians and the FED think interest rates will remain low forever, like they did with Real Estate – that it would never go down….. If people start selling bonds then the Ponzi scheme will be up! Need to watch the bonds for direction.
Yes, indeed! The bond market is the biggest bubble of all and even bond maven, Bill Gross, is warning that the bond market is one giant bubble and he is recommending gold. Yes, the bond king is actually recommending gold. That says it all!