A couple weeks ago I posted these same charts talking about the pending breakout (in either direction) with silver, gold and mining stocks. Fast forwarding to this week its clear this sector continues its struggle to rally. Key support levels are now being tested and if these levels fail prepare for a sharp correction with mining stocks showing the most downside potential of roughly 25% for the GDX ETF trading fund.

Let’s take a quick look at what is going on…

Gold Trading Chart:

The chart of gold shows price being wedge into the apex of the down sloping resistance trend line and the rising support trendline. Gold was trading below this level but has since bounced. But if gold closes the week below this line in the sand the price could start to fall quickly and test the $1200 per ounce within a week or two.

Read Full Report including Silver & Stocks: http://www.thegoldandoilguy.com/articles/silver-gold-miners-sell/

Chris Vermeulen

…[But] You Have To Be Careful”

Due to the significance of the next few weeks’ market action, yesterday’s Sunday note to blog subscribers is posted below…

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Greetings and Good Sunday,

Following another week of sideways trading action in the precious metals and mining sector, consensus among the experts remains conflicted.

According to technical gold trader Gary Savage, short positions are buildingfor another overnight attack on the price of gold to occur within the next 30-45 days. This takedown Gary noted, may be the final plunge to $1000 before a powerful launch takes gold higher, to the $1800-$1900 level by next summer.

This potential collapse Gary noted, “Will bottom in a v-shape and come roaring back out…[because] three funds that have been trying to drive this down…will flip and go long…so I think the buying pressure…is going to be huge.”

Billionaire Jim Rogers also noted during an interview this week that the consolidation in metals and miners has been an anomaly–which following 12 years of steady increases in the price of gold should be expected. Jim further advised that listeners, “Be worried and get prepared,” for a major systemic collapse to occur in the US sometime between now and 2016.

Such an event may present another 2008-style liquidity crisis Jim noted, with those maintaining large levels of cash and fungible metals being likely shielded.

When asked his thoughts on investing in the mining sector, Jim concluded bysaying that, “If you figure out the right mine [and] the right company, you could make a fortune…[and] you’ll make a lot more in the right mine than in the commodity…[but] you have to be careful.” 

As a final item of note, I’ve compiled a list of a few companies founded and led by mining entrepreneurs who have historically found “the right mines” and built “the right companies”–making their shareholders absolutely wealthy in the process. That list is called, the Da Silva “Legendary Mine Builders” Index, and as a special thank you for supporting my work, I’d like to offer you a copy at $50-OFF.  

To receive a copy of that report at $50-OFF, simply click HERE.

As we find a bottom and launch higher in the metals and miners as billionaire Eric Sprott and trader Gary Savage expect, we’ll finally, “Get to brag about making several 100′s of percent while [our] ‘stock buddies’ will be sitting on huge losses,” Gary noted over the weekend. In the meantime however, “We’ll have to endure the taunts of all our friends and associates that are ‘getting rich’ in stocks.” 

That’s all for now. Best in health, wealth, and happiness in the new week ahead!

Best,
Tekoa Da Silva
Bull Market Thinking

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