Knock, knock! Are you listening? Buy the dips! Today is one of those days. Gold will not stay below its 200-day moving average, a rare event indeed, for long.
It’s 11:30 New York time on Wednesday morning and everything is down big-time today. The euro plunged below 1.30; the Swiss franc is now down to 1.049 (down from over 1.30 not long ago); platinum is down a huge 4+% and palladium is down an even larger 7+%. The XAU and HUI are down over 4% and so is oil. The Dow is down a mere 117, but the day is early and our friends over at the PPT will do all they can to keep the damage there, to a minimum. The dollar is UP 3.5%, which would indicate that all the funds are puking up everything and moving to cash, in the form of dollars. Shades of 2008 without a Lehman event (yet). Now, we get to the metals that the Gold Cartel loves to punish the most, gold and silver. Silver is down a large 8+% and gold is down over 3.5%. This is mindless, panic selling. And here I sit, on the sidelines, with a lot of fresh cash from my sale of mining shares yesterday. One thing I am certain of, the drop will be short-lived and the rebound will be fast and furious.
In my Wednesday newsletter I wrote the following:
In the short-term, gold and silver could move lower from these levels, due to Europe not understanding that we are in a DEBT crisis, not CURRENCY crisis, and since people will need to raise cash, they are dumping everything, even solid assets like gold and silver, along with the dead weight. This will have the effect of setting up a HUGE rally in the medium-to-longer-term. 2012 will be a HUGE year for gold and silver.
Nothing has changed in the last 24 hours except the prices are lower and the pre-Christmas sale on all things gold and silver is in full force. If this were a “retail” event, people would be lined up at the front door, hours before opening, waiting to snatch up the bargains. Yes, it looks that good to me.
Andy Hoffman sent me the following this morning:
Alas, sometimes things can be pushed TOO FAR by PAPER selling, as – ALERT, ALERT – gold has now been knocked down to its 200 DMA at $1,615/oz., an incredible Cartel achievement given the current fundamentals suggesting a parabolic up move, but far from surprising, as this is the Cartel’s M.O. – hitting gold HARDEST at the times it screams to rocket HIGHER. Not to mention, for all those focused on the SHORT-TERM chart of the “bullish wedge,” yet again RANTING ANDY’s mantra that short-term charts are meaningless in a rigged market proved correct.
That said, LONG-TERM charts are extremely valuable in PM market analysis, as constant Cartel capping creates MONSTROUS resistance formations that, when inevitably broken, become MONSTROUS, essentially UNBREAKABLE support. The ONLY time in the entire 12-year bull market that gold has fallen significantly below its 200 DMA was at the bottom of GLOBAL MELTDOWN I, another Cartel-induced attack that took gold 15% below that average, which lasted a total of two months before it surged back above that level. Aside from late 2008, the ONLY time gold’s discount to its 200 DMA exceeded 5% was mid-1999, amidst the “Brown Bottom” when the U.K. was OVERTLY selling 400 tonnes at the historic low, and EVEN THEN the discount to NAV never exceeded 9%! Heck, the last time gold traded at an discount to its 200 DMA of more than 9% was in 1990, amidst a vicious bear market, essentially to the week Miles Franklin commenced operations, and EVEN THEN the largest discount to NAV was just 12%, lasting for just ONE WEEK! Adding an explanation point to the analysis, the last time gold traded at a 15% discount to its 200 DMA was in 1982, at the beginning of a 17-year bear market, 29 years ago!
A few words from FutureMoneyTrends.com:
Could this be the religious experience Rick Rule spoke about in our interview with him just a few weeks ago?
His exact words were, “If you go into a gold trade leveraged long in the futures market with 20% cash down, what you will experience in the next few months is going to be a religious experience and not of the pleasant kind. If however, you are a rational sober speculator who goes into a trade where you can stay the trade, and takes advantage of volatility rather than being taken advantage of by volatility, this will represent what is perhaps a once in a lifetime opportunity.”
As the Euro crisis escalates, gold, silver, and other assets are falling. However, it is important to remember that at the core of this, it is a currency crisis. As noted in our recent silver video, which has already received over 97,000 views in just 72 hours, IF silver gets hit hard like it did in 2008, we could literally see all hell break loose in the physical markets. Now in our video we put that price at anything below $24, however, today the price has fallen below $29 and we are already seeing that most dealers are not budging on their physical prices. One of the dealers we buy from normally sells 1 oz. bullion rounds for about $1-1.50 over spot, today they are selling those rounds for $3.20 over spot (we include shipping). So no delays, no shortages, but we are not seeing the physical market get hit nearly as hard as the paper markets. Remember, the paper markets have over a billion ounces of silver traded every single day, that’s more than all the silver mined in 1 year. So, as long as the paper fraud continues, we have to expect these kinds of days, but like Rick Rule said, “taking advantage of volatility can perhaps be a once in a lifetime opportunity.”
And a few words from our friend Bix Weir:
The computer market riggers are working overtime this week. So much so that they have flushed all weak hands out of the market and have succeeded in driving the price of silver below $30! WOW…WHAT A GIFT!!!
Buying silver below $30 today is like buying silver below $5 ten years ago!
A few thoughts for Private Road Members on why now…
Don’t let this opportunity pass ESPECIALLY those of you who thought you came too late to the silver party!
BUY, BUY, BUY…the party has just started!
For those of you who are already “all in” just sit back and enjoy the show. If anyone needs a little hand holding here’s an article that should make you feel better:
The Silver Pacifier