Gold & Precious Metals

This has been a momentous month for gold, with it finally breaking out of its long downtrend to commence a major bullmarket. Thus it is amusing to see Goldman Sachs talking about it dropping back to $1000 again. Those timorously wondering whether they are right should stop and ask themselves whose interests are paramount to Goldman, the government and Wall St, or the Little Guy trying to protect what’s left of his capital. Those still in doubt should read Goldman Capitulates .

While government may see gold as the barbaric relic of the past monetary history, it still will serve as a hedge against them from the private individual side. Our biggest problem is the Hunt for Money. They are of the opinion it is not their fiscal mismanagement that is causing the instability, it is that we have money they see as their’s. This is the historical classic battle between Public and Private I have warned about. You may not be able to travel with gold any more as they close the corral and try to slaughter us for money. But history still demonstrates they will collapse. It is then when gold will provide its more historic base purpose as the hedge against government. It is not a hedge against inflation nor will it track with the increase in money supply. It is driven by confidence and the lack thereof. When the latter raises it head, then it is time for gold to rise. Keep in mind I would recommend real gold coins of bullion value common dates compared to bullion. At least then you can claim you are a coin collector. That worked before at least in the 1930s.

Feb 16, 2016  

  1. Led by oil, the world’s risk-on assets are beginning what could be a fairly significant bear market rally. Bear market rallies tend to be quite violent. They often end very quickly, without warning.
  2. Please  click here now. Double-click to enlarge. There’s a double bottom pattern in play on this daily bars oil chart. 
  3. Oil is one of the world’s great risk-on assets, and its price action can be a good lead indicator for other risk-on assets, like the US dollar and the Dow.
  4. Please  click here now. While production quotas may do more long term harm than good, in the short term, they are fuelling a strong rally in the price of oil.
  5. Basis Dow Theory, the US stock market fell into a bear market last week. The Dow Industrials closed below their August closing low. The Industrials could stage a dramatic rally now, but unless the Transports stage an even better performance, a bear market rally is all this will be.
  6. Please  click here now. Double-click to enlarge. Recently, this daily bars chart of the Dow has shown great similarity to the oil chart. 
  7. It’s hard to know exactly how high the Dow could go on this rally, but it would not surprise me to see the Industrials make a marginal new high, while the Transports fail to do so.
  8. Please  click here now. Most analysts are very concerned about the Chinese economy, but I think some of those concerns have been created by predatory hedge funds who have made large bets against Chinese markets. 
  9. The Chinese economy is suffering “transition pain”, as it moves from an exports-oriented theme, to one of domestic consumption. Growth may be less than what is officially stated in China, but bank loans are strengthening, and that’s adding fuel to the global markets risk-on rally.
  10. Please  click here now. Double-click to enlarge. That’s the daily bars chart of the US dollar against the Japanese yen. The US dollar is the world’s largest risk-on market, and it is currently rallying towards the neckline of a huge and bearish head and shoulders top pattern.
  11. Most amateur investors think the US dollar is a risk-off trade, but major FOREX players know it’s part of the risk-on sector. Japan is the world’s largest creditor, and its savvy citizens are phenomenal savers. In contrast, the United States is the world’s largest debtor, and the citizens tend to embrace excessive debt as a kind of “moral good”.That’s not a good thing, to put it mildly.
  12. As professional investors try to get in on the risk-on assets rally, that’s putting some pressure on gold, which is the most important risk-off asset. 
  13. Please  click here now. Double-click to enlarge. That’s the daily bars gold chart. The power uptrend line was snapped by the surge into risk-on assets, and the decline may be forming the elusive right shoulder of large inverse head and shoulders bottom pattern.
  14. Please  click here now. Top analysts at Deutsche Bank have the same view I do about the bear market in most global equity markets. If the Fed hikes 3 – 4 times this year, as I’m predicting, risk-on assets could begin to stage a bear market meltdown that is reminiscent of 1929.
  15. Goldman’s top commodity economist is Jeff Currie. He’s also predicting 3 rate hikes this year. He argues that will pressure gold to the $1000 area before a major upcycle in oil begins later this year. He believes that upcycle would unleash a major rise in almost all commodities, following oil’s lead.
  16. I understand Jeff’s viewpoint. I have tremendous respect for his abilities, and for the liquidity flows he can create with his statements, but he thought gold would tumble when the Fed raised rates. Instead, exactly as I predicted, rate hikes created a panic out of lead risk-on markets like the Dow and the dollar. That created a huge surge into the lead risk-off markets of gold and the yen.
  17. Please  click here now. I don’t think Bloomberg has all the facts about what is happening in India. There is a lull in buying, but the gold price rally is only part of the reason for that lull. In the bigger picture, the national budget is scheduled for release within about two weeks. Most jewellers expect the gold import duty to be cut from 10% to the 2% – 4% range.
  18. Against the background of a serious rally in the gold price and the prospect of a duty cut, most Indian buyers have ceased their buying, and they will stay in “cold” mode, until that budget is released.
  19. Tactics? The Western gold community needs to prepare for the unexpected, and gold certainly could trade in the $1000 area, as Jeff Currie predicts it will. In the current situation, put options on gold, bought as portfolio insurance, are a fearful investor’s best friend.
  20. If Janet Yellen raises rates repeatedly and relentlessly, like both Jeff Currie and I are predicting, he may be correct that gold declines to $1000 before moving higher, or I may be correct that risk-on assets resume their bear market, and gold and the yen stage powerful rallies. Put options keep the investor protected, yet in the upside game, regardless of whether Jeff’s scenario or mine is the one that happens.
  21. Also, my GDX and gold trading service at  www.guswinger.com has performed spectacularly well during the “gulag” action of the past year, as well as during the huge rally of 2016. Send me an email to stewart@gracelandupdates.com and I’ll send you the track record in Microsoft Excel format. A trading account is not a replacement for physical bullion and quality gold/silver stocks. It is a good way for the investor to diversify their tactics, in the world’s greatest asset class.
  22. Please  click here now. Double-click to enlarge this phenomenal GDX daily bars chart. I suggested that GDX would stage a violent upside rally from the wedge pattern, and that has happened. 
  23. A budding major uptrend is now in play, and so is a potentially very bullish inverse head and shoulders bottom pattern. To view that scenario, please  click here now. Double-click to enlarge. The price action is superb, and as more right shoulders are formed, GDX should move steadily higher.
  24. Gold stocks get a “bad rap” from the mainstream community (MC), but the reality is they are part of the risk-off gold market. Gold mining itself is inherently risky, because the product mined is so difficult to find. That doesn’t change the fact that the gold sector is a risk-off market, and gold stocks will be bought as institutions pour out of risk-on markets like the dollar and the Dow!  

Feb 16, 2016
Stewart Thomson  
Graceland Updates
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Stewart Thomson is no longer an investment advisor. The information provided by Stewart and Graceland Updates is for general information purposes only. Before taking any action on any investment, it is imperative that you consult with multiple properly licensed, experienced and qualifed investment advisors and get numerous opinions before taking any action. Your minimum risk on any investment in the world is 100% loss of all your money. You may be taking or preparing to take leveraged positions in investments and not know it, exposing yourself to unlimited risks. This is highly concerning if you are an investor in any derivatives products. There is an approx $700 trillion OTC Derivatives Iceberg with a tiny portion written off officially. The bottom line:

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Summary

Google Trends has once again flagged a tradeable bottom for the SPDR Gold Shares ETF.

The sentiment shift in gold is also demonstrated by significant changes in the trading action for the SPDR Gold Shares ETF.

Most importantly, significant changes in the global landscape for interest rates and rate expectations are helping to sustain a fresh interest gold.

Google Trends continues to prove itself useful in assessing the potential for important turns in the direction of gold, specifically the SPDR Gold Shares (NYSEARCA:GLD).

….read more HERE

Something Big Is About To Happen With Gold And Silver

Posted by Steve St. Angelo - SRSrocco Report

on Friday, 12 February 2016 15:51

The markets have finally cracked and things are about to become a lot more interesting.  Today, the price of gold surged more than $60 and silver $0.60 as the markets crumbled.  Even though the markets recovered after some TWO-BIT announcement by OPEC stating that they were talking about “Cutting Production” again… I believe the worst is yet to come.

It has been quite some time since the gold priced shot up more than 5% in one day.  As I stated in past articles and interviews, we will continue to see a lot more days like today.

The huge spike in the price of gold sparked a surge in demand.  According to the Zerohedge article, Lines Around The Block To Buy Gold In London; Banks Placing “Unusually Large Orders For Physical“:

BullionByPost, Britain’s biggest online gold dealer, said it has already taken record-day sales of £5.6m as traders pile into gold following fears the world is on the brink of another financial crisis.

Rob Halliday-Stein, founder and managing director of the Birmingham-based company, said takings today had already surpassed the firm’s previous one-day record of £4.4m in October 2014.

BullionByPost, which takes orders of up to £25,000 on the website but takes higher amounts over the phone, explained it had received a few hundred orders overnight and frantic numbers of phone calls this morning.

“The bullion market has been building with interest since the end of last year but this morning things have gone bananas,” said Mr Halliday-Stein. “Some London banks are placing unusually large orders for physical gold.”

London-based ATS Bullion added it had been inundated with orders for the past week. The firm has sold 4,000 gold bars and coins since February 1, a 40pc rise on the same period a year ago when it sold 1,500.

Again, I believe this is just the beginning of what will become an AVALANCHE of physical gold and silver buying.  Right now there is only a hint of fear.  Wait until the markets really start to tank as the price of oil heads below $20.

Gold Eagle Sale Surge In February

While demand for gold in Europe has spiked today, Gold Eagle sales surged this week and are already 116% higher than last year February sales:

Gold-Eagle-Sales-Feb-2015-2016-NEW

In the first week of February, the U.S. Mint sold 12,500 oz of Gold Eagles.  However, this week they sold another 29,500 oz for a total of 40,000 oz.  In less than half a month, the U.S. Mint has sold more than twice as many Gold Eagles as it sold for the entire month last year.

Silver Eagle sales are also quite robust.  Total sales of Silver Eagles (Jan-Feb) are now 8 million versus 8.5 million sold last year.  However, we must remember, the U.S. Mint has put a weekly allocation of only 1 million per week.  So, sales could not be any higher than 8 million.

If the U.S. Mint keeps the weekly allocation the same, while demand remains strong, we can see a total of 10.5+ million oz sold in the first two months of 2016.  This would be nearly 25% more than last year.

Here We Go Again… U.S. Silver Imports Surged In December

Last year, I kept track of the elevated level of U.S. silver imports.  After the spike in silver retail investment demand began to wind down in October and November, U.S. silver imports also declined.  However, something changed in December:

Total-U.S.-Silver-Imports-Nov-Dec-2015

U.S. silver imports jumped by more than 33% in December versus November. Matter-a-fact, the 557 metric tons (mt) of total U.S. silver imports were the second highest monthly in 2015.  If we look at the data for the entire year, the U.S. imported nearly 1,000 mt more silver than it did in 2014:

Total-U.S.-Silver-Imports-Q1-Q4-2014-2015

Now, why did silver imports pick up in December if investment demand dropped off as well as industrial demand??  I stated in previous articles that the main driver for the increased silver imports in 2015 had to be investment demand as industrial demand trending lower throughout the year.

I believe there continues to be large entities acquiring silver off the radar.  Moreover, the silver didn’t go into the Comex inventories as stocks continued to decline in December.

Something Big Is About To Happen In Gold & Silver

It seems as if the markets finally cracked today.  While the clowns and nitwits at the Fed and on the Financial Networks continue to regurgitate that “Everything is okay”, the markets are about to take another huge noise-dive lower.

Fear is starting to enter back into the psyche of the investor.  All it would take would be the bankruptcy of a financial institution such as Deutsche Bank to push the whole thing over the cliff.  When Deutsche Bank finally goes belly up, we will see an avalanche of physical gold and silver buying.  Analyst Jim Willie believes the collapse of Deutsche Bank will be Lehman Brothers TIMES 5.

Already we are see panic buying of gold in Europe and things haven’t really gotten all that bad yet.  At some point, the situation in the markets will become so dire… available supply of the precious metals will simply dry up.

So, you wealthy investors out there who still have your net worth tied up into paper assets… you better wake up and start buying physical gold and silver before it’s too late.

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