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Silver Market Update
http://www.silverseek.com/news/Clive...clivemaund.PNG
By: Clive Maund
-- Posted 16 August, 2011 |
Silver held up surprisingly well during the stockmarket collapse - you will recall that we had expected it to take more of a beating - no doubt assisted by gold's sparkling performance, so that now, having held above strong support, and with a marked improvement in its COT structure over the past week, it is believed to be poised for a really strong upleg.
http://67.19.64.18/news/CliveMaund/2011/8-15cms/1.gifThe 6-month chart for silver shows HUGE upside potential, with a powerful uptrend starting from right where we are now. If the interpretation of the wave count is correct (this can be a big "if" of course, but it does look very clear at this point), then the point we are at now is close to the trough of the wave 2 reaction that should now immediately lead to a strong wave 3 uptrend, all this following the 3-wave A-B-C correction shown on the chart. Even without reference to wave theories the chart certainly looks encouraging as silver managed to break above the quite strong resistance in the $39.00 - $39.50 zone on its wave 1 advance which is now functioning as a support level, in addition to which its moving averages are now in bullish alignment and it is not overbought on short to medium-term oscillators as made clear by the RSI and MACD indicators on the chart. Everything appears to be in place for a big rally to get going - "all systems go" as they used to say.
http://67.19.64.18/news/CliveMaund/2011/8-15cms/2.gifFurther evidence that a big rally is brewing in silver is provided by the latest COT chart, which shows a surprisingly large reduction in Commercial short positions in just one week - the Commercials are getting out of the way, which signals a rally - and it may have just started with today's 85 cent rise.
http://news.silverseek.com/CliveMaund/1313474760.php
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Quote:
Originally Posted by
JJ.G0ldD0t
and what do we anticipate form looking at this?
Not sure really but interesting chart to see that silver has doubled in a year........Clive Maunds are interesting though
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Gold Stocks & Silver: This Is It!
-- Posted Tuesday, 23 August 2011 | | Source: GoldSeek.com
http://news.goldseek.com/GoldSeek/1314117196.php
Graceland Updates
By Stewart Thomson
1. A maniac is dictionary-defined as a person who is either a raving lunatic or overly-zealous about something. For example, a person could be said to be maniacally obsessed with… details.
2. I’m overly obsessed with silver and gold stock details right now. I’m obsessed with the mountain of buy orders I have in the market for silver bullion, and for gold stock. For example, as of this morning, for silver, my buy orders are now every 10 cents down.
3. I labelled the $1462-$1478 price lows for gold as the “zone of doom”, because 93% of gold analysts were documented as bearish at the time of those lows. I spoke of the gold stocks gulag, and that phrase summed up the horrors endured by long time gold stock investors. I spoke of enduring your way to victory.
4. Click HERE NOW to view why you endured the gulag. Party time is here. Rocket launch time is near. That’s a nice rhyme, and a nicer reality. Congratulations to all gold stock astronauts for staying in the space ship, rather than running to mommy at the photocopy machine.
5. The weekly GDX chart shows an epic volume bar. The bottom line is that gold bullion has set up GDX…. to literally blow the doors off the US dollar. You thought you were in a gulag, but it was a spaceship on the launch pad. Welcome, champions, to the real world!
6. Some seemed to go into physical shock as gold went near-vertical from $1478, when it was supposed to roll over dead, according to their summer doldrums kiddie script. I’ve labelled this $1478-1910 move in time and price as the pre-parabola zone.
7. Most analysts, and investors, are trying hard to call a short term top on gold, and are labelling this area as extremely overbought. My question is, “is that really relevant, here and now, in the greatest economic crisis in world history?”
8. You need to look in the mirror and ask yourself why you’re here, as a card-carrying gold community soldier. In the parabola zone, there are going to be the biggest hits on gold yet, and they are impossible to predict. If I blow up some egos, I apologize, but you need to ask yourself if you want to predict what cannot be predicted, or if you want to get richer.
9. I believe silver has a head and shoulders base pattern on it that is 30 years in size, and a break-out is imminent. That’s why I’m buying silver every 10 cents down. Not here or there. Every 10 cents down. I’m not looking for “strategic entry points”; I’m mauling the market with buys.
10. Click HERE NOW to view the greatest base pattern in the history of markets!
11. How high can a 30 year head and shoulders base pattern propel the price of silver? I don’t know, but this price pattern is arguably the largest base pattern in the history of markets, and the question is, are you onside?
12. The tactical approach to operating in the parabolic zone is to tone down, substantially, your analysis of where price is going, and tone up your response to what actually happens. In terms of size, you need to sell like a bird on strength, and buy like an elephant on weakness.
13. Europe is burning, the dollar is burning, and governments are burning. Elmer Fudd Public Investor won’t have any stock market investments by the time the final bell rings on this, the big show. He’s going to make the people in the 1930’s breadlines look like they were in the party zone! The bottom line is that the big picture is going out of control and ushering in the gold parabola zone.
14. Martin Armstrong talks of hedge funds betting on the demise of European “virtual currencies”. He argues that national government bonds are being shorted by the fundsters as though they are national currencies of those nations. He worries that unless national debts are consolidated into a single Eurobond issue, dictators could arise in nations like Greece. These nations can’t devalue their currencies, and the market is devaluing their bonds like they are currencies going off the board!
15. I’ll add that the euro horror show playing out before your eyes now, gives you a glimpse into the supreme gulag being planned for you by the banksters, with their one world government/one world currency scheme. They know the horrors it will bring to you, and plan to use those horrors to enrich themselves, all the way to the quadrillionaire zone. Yes, maybe it is a good idea to get your hand off that gold top calling button, now.
16. Maybe it’s also time to give the tick chart technical analysis of the gold market a bit of a rest, and enjoy the ride! Don’t do to yourself in silver and gold stocks, what many have done to themselves in gold bullion already, with their failed top calls. While others talk about how low silver and gold stocks might go if the Dow crashes, I’m sucking up silver every 10 cents down, without a single missed buy. Have you missed any buys? Well, please miss some more, because that’s just more silver for me. Thanks!
17. The price hits on gold and its blood relatives, in the parabola zone, are going to be ultra-sharp, ultra-short, and ultra-unpredictable. Note that word, “unpredictable” and keep it mind before pressing your gold top call button. Most of you have no idea how fast the gold punisher can leave you in dollar dust, in the parabola zone.
18. I expect gold to rise by an average of $100-$200 per day, silver by $3-$5 per day, and GDX by $5 per day, as the OTC derivatives–loaded US T-bond market implodes, in the greatest financial fireball in the history of markets.
19. The stratospheric price point implications the base pattern in silver are a direct indication of the size of the interest rate OTC derivatives horror. The bond market is not a safe haven. It’s a time bomb, and the banksters are making their way towards it now, with fuses and lighters. Are you sure you want to play gold top caller here?
20. Are you sure that an OTC derivatives interest rate fireball that causes the total destruction of the American government bond market is really a reason to top call gold today? Maybe you can time your way through the coming implosion of the bond market. I say all the timers will look like microscopic glow worms, by the time the banksters finish with them.
21. This is it! We’re on the edge of the gold parabola and, horrifically, most investors seem to be trying to top call themselves out of gold, and onto the breadline, alongside Elmer Fudd Public Investor! My suggestion, instead, is to stay strong. Sell like a bird. Don’t plop into silver or gold stocks. Buy consistently like a machine, on all weakness, with risk capital you can reasonably place. Most investors have no clue how bullish for gold the implosion of the bond market is, and the time is near. I think an event in Europe lights the whole interest rate OTC derivatives garbage dump on fire, but it could be any trigger.
22. The Dow is almost out of control. The dollar bear market is on the verge of going out of control. The term “out of control” is the key driver of the gold parabola. Look around you, ladies and gentlemen, and you tell me while you have your finger on the gold top call button… are you doing, really, the right thing? I say that it’s the buy button you need to be focused on, and my strongest suggestion to you is that you don’t learn this key fact, the hard way!
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http://kingworldnews.com/kingworldne...ld_Market.html
With gold hovering near the $1,800 level, a trader out of London told King World News, “China is trading gold at a $17 premium today vs COMEX futures. Silver is trading at a premium of $2.48 vs futures price (COMEX). What this tells you is that these people in China are willing to pay the equivalent of roughly $12,500 more per contract than what silver is being traded for on the COMEX.”
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London Trader continues:
“As soon as China closes trading each day, that is when the selling starts in the paper markets. These raids on the price are designed to get weaker players flushed out of the futures markets so they (commercials) can cover some of their short positions.
If there is that strong of a bid for gold out of the Eastern hemisphere, what that tells me is that all of the heavily leveraged paper manipulation in the West will not have much more downside impact. All the manipulators are doing at this point is compressing a spring, but at some point this market is eventually going to gap up incredibly hard against them.
Two weeks ago there were some indications that the gold market was going to be taken down, an example being the sharp drop in lease rates. You know how this works, a central bank(s) are selling some gold into the market and the bullion banks, which act as agents for the central banks, take that gold and sell it into the market and even use leverage at weak technical points....
Continue reading the London Trader interview below...
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“They also do this when trading is thin, such as during the access market when no one is around, and they drive the price lower in an attempt to create panic by the longs.
After lease rates had dropped and the gold market was attacked, we find out after the fact that the central banks decided to raise dollars by leasing gold. The central banks had not done that for two years. Central banks have been preserving central bank gold and overall the central banks have been net buyers, and then all of the sudden they lease it, thus selling it into the market.
For what it is worth, this gold goes right into an Asian vault and it is gone from the West permanently. This is having the effect of transferring Western solid assets over to the East, in size. This has the appearance of desperation because in the end this is really an attempt to save the too big to fail banks that are on the wrong side of a derivative play yet again. That is the reason this is being done.
Western central banks don’t really want that gold to disappear like that, they don’t want to sell that gold. They had to raise dollars in a hurry to pump liquidity into the system, but in the end, as I said, the gold is gone. In the old days the gold would be floating around the LBMA system, there would be a little bit of erosion, but today that gold is being sucked into the East.
This price action has had the effect of creating bearish sentiment, but meanwhile the physical buyers are just sitting there and constantly accumulating physical gold. There are massive orders for tonnage of gold, incredible amounts between $1,715 and $1,760. This has the effect of putting a physical floor under the price of gold. If they make a push to the $1,715 level that would be suicide in my opinion. There are simply too many massive orders for physical gold down to that level for that to be breached.
During this quarter this leased gold is supposed to be paid back, but how? As the central banks come to grips with the reality that the leased gold is gone, there may be a religious experience to the upside in gold and you will see the gold price break the $2,000 level.
As far as silver goes, the paper price is becoming increasingly irrelevant. It is possible there could be a spike to $37 or $38 in thin access trading, but the bottom line is that serious physical buying will be taking place anywhere below $40, so this is a losing game for the paper manipulators.”
This is the same trader that told King World News on August 10th with gold trading near the $1,800 level, “The physical buyers still have not been filled and they are getting nervous. The buyers in size have not been filled and they are underpinning this gold market. If gold pulls back the buyers will get some fills, if not they are going to have to start chasing this market. In fact, don’t be surprised to see a $100 move in gold if they lose patience.”
Within days the price of gold spiked more than $100, breaking the $1,900 level. Now the London Trader is telling King World News to expect this massive physical floor on gold to hold and that we should also look for gold to take off to the upside through the $2,000 level. If sentiment is any indicator, the pessimism in gold could be signaling this market is in fact ready to turn, let’s see what happens.
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Dan Norcini - Huge $17 Gold & $2.48 Silver Premiums in China
With a fierce bull/bear battle developing in gold around the $1,800 level, today King World News interviewed legendary Jim Sinclair’s chartist Dan Norcini. When asked about the incredible strength in the gold market under the $1,800 level, Norcini stated, “Earlier today your source out of London mentioned the Chinese were paying a $17 premium for gold and an astounding $2.48 premium for silver vs the COMEX over in Shanghai. This is absolutely incredible and you can see it in the charts. The support that is underneath this market is rock solid -- that’s the Asians who are buying in the London and COMEX markets. http://kingworldnews.com/kingworldne...oppedImage.jpg
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“As I read that piece, Eric, it was a confirmation of the technical action that has showed very strong buying below the $1,800 level and it keeps forcing the market back up rather quickly. Yesterday it appeared that the buyers were waiting to see if they could pick up some gold at cheaper prices, but today they lost patience and you could see the concerted buying effort, which took gold right back above the $1,800 level.
When the Western central banks started their assault on the gold price about two weeks ago, they took the price of gold down over $60 in one minute’s time in the thin trading conditions in the access market. It was an attempt on their part to induce enough long side liquidation by the speculative community, particularly the hedge funds. It was also an attempt at trying to entice them into a sell mode to help drive the gold price lower.
This has been the pattern for Western central bank gold price manipulation, the attempt to get others to continue the selling for them once they initially pull the trigger. Well, what’s been happening is that when the hedge funds have been selling, instead of the gold price cascading sharply lower, the gold price is finding buyers. It will not collapse, they cannot create the normal avalanche of selling, even with hedge funds liquidating 67,000 long contracts because of what is taking place in the physical market.
Somebody is obviously coming into this market and buying in size, in sufficient quantities, which is thwarting the central bank manipulation efforts dead in their tracks....
Continue reading the Dan Norcini interview below...
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“Because they cannot get any traction at all to the downside, the bullion banks and the swap dealers are having to cover into these shallow drawdowns in price. They simply don’t have a choice as a very powerful force is standing in the way of further downside action.
The physical buying by the Chinese and other Asian participants is forcing the bullion banks and swap dealers to come in and cover their short positions prematurely. All I can tell you is that as long as those big buyers are coming in from Asia, the bears are in trouble.
There is something else at work here and that is the price action in the mining shares. Normally, in the past when there is a move down like we have seen recently, there is a washout in the mining shares, they would literally implode to the downside. Now, even when the gold price is attacked by the bears, the mining shares hold firm. Today the HUI gold bugs index actually closed within striking distance of the all-time highs.
Look at Newmont, this is a stock that has gone almost straight up for the last month. Newmont announced that if the gold price stayed above $1,700, they were going to increase their dividend. Well, that’s good news if you own Newmont, but it’s horrific news if you have been shorting Newmont.
As you know, Eric, these hedge funds have been playing that ratio spread trade where they have been buying paper gold and selling the mining shares. As we’ve been warning, that ratio trade is beginning to blow up on them as the mining shares are increasing their dividends.
The bottom line is the mining shares are advancing, which is one more thing making it that much more difficult for the commercials to break the gold price.”
http://kingworldnews.com/kingworldne..._in_China.html
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Stephen Leeb - China Gold Consumption Going Exponential
Stephen Leeb continues:
“Do you really want to buy the euro when you have Greece, which is spending like a drunken sailor, no. You want something that is going to be around for as long as you’ve been around, and the only currency that has been around for as long as the Chinese have been around is gold and silver.
Right now my guess is Chinese consumption of gold has been exponential. China and India will take off of the market 1,000 tons a piece this year. That’s about all of the gold in the world that we are going to produce this year. What that means is any additional gold that you want, you’re going to have to buy it from somebody who already has it. I don’t think anyone is really going to want to sell it.
And when it comes to silver, the Chinese are going to be in the market for tons and tons and tons of silver. It’s no accident that silver is near $40, even though it has come down from $50 and you know what, Eric, it’s going to go through $50. Silver is going to go through $100 and people are going to say, ‘My gosh, silver is no longer a double digit commodity.’ Who knows how high it will go because it is vital for China’s industrialization and solar energy needs and it is also money....
“I hate to say this, I really hate to say it, but I think every family, every single investor in this world has to own precious metals and they should probably be the largest percentage weighting in their portfolio. I’m not talking 100%, but I am saying 20%, 30%, 40%, whatever you’re comfortable with.
One thing that is off the topic of gold, but convinces me that something is amiss in this world, we’re sitting here in the US with more than 9% unemployment. Participation rates in the labor force close to all-time lows or certainly post World War II lows.
Do I have to say what a mess Europe is with Greece collapsing, they are a certain default. Portugal and Spain are having problems, Italy was downgraded. Yet despite this, every critical commodity I can think of, even copper, which has been brutally hit, from copper, to silver, to gold, to oil, they are all in uptrends.
For oil, which is probably the biggest commodity in the world, Brent crude oil has been above $100 for a record number of days. Now go back to 2008, who would believe that? The entire Western world could not muster any growth at all in 2011, yet oil prices will have the highest average price ever this year.
So when you see commodities sustaining this massive uptrend, despite all of this turmoil and unemployment in the developed world, there is something wrong here. So in that environment is it so surprising that gold is so strongly bid?”
http://kingworldnews.com/kingworldne...ponential.html
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Re: Silver Phase Transistion
Tuesday, January 17, 2012
HAS GOLD'S D-WAVE BOTTOMED?
It seems like most analysts, and gold bugs are now assuming that the reversal on December 29 marked the bottom of golds D-Wave decline. It's certainly possible that we saw a bottom two weeks ago but it's still too early to make that assumption. Gold, and most assets are about to be severely tested. How gold handles that test will be a big clue as to whether or not the correction is over.
http://goldscents.blogspot.com/2012/...-bottomed.html
What many analysts are overlooking is the impending daily and intermediate cycle correction that is coming due in the stock market. When the stock market moves down into a cycle low, especially an intermediate cycle low, it generates a tremendous amount of selling pressure. Invariably that selling pressure bleeds into virtually every other asset class, even gold, as you can see in the chart below. Over the last two years there were only two daily cycle corrections in the stock market where gold was unaffected (I've marked them with green arrows).
The stock market is now in the timing band for a move down into a daily cycle low. As you can see in the chart below those tend to occur almost like clockwork about every 35 to 40 days. As of Friday the stock market was on day 33. On top of that we have a larger intermediate degree cycle that should bottom sometime in March/April. The selling pressure generated at an intermediate bottom is much more intense than a mere daily cycle low. That means sometime around the middle of March or early April things are going to be looking pretty bleak. My best guess is at that time interest rates will be spiking in France and maybe the UK (along with all of the other countries that are already having debt issues).
It's late enough in the daily cycle that there is a good chance the market began that move down into its daily cycle bottom on Friday, despite recovering most of the sell off before the close. I say that because we have a coil pattern playing out in the stock market.
Contrary to what most people believe, the initial break out of a volatility coil is usually a false move that is soon followed by a much more powerful and durable move in the opposite direction. In our case the volatility coil broke to the upside and by Friday it was already trying to reverse. Once the stock market moves back through the coil zone it would be very unlikely to recover those levels until after the next intermediate degree bottom, which like I pointed out isn't due until March/April.
Sometime in the next 4-8 days we should see the stock market break its cycle trend line. It's very rare for a move down into a daily cycle low not to break the cycle trend line. So for our purposes I think we can probably assume that it will.
If the stock market just retraces 50% of the daily cycle advance (assuming 1297 is the top) then we should see a pretty hefty sell off in the next week or two.
That kind of selling pressure will almost certainly have some affect on gold. If the D-Wave is still in progress it's going to have a sharp affect on gold, probably forcing gold back below the $1523 December bottom. How gold handles the stock market moving down into its daily cycle low will give us a big clue as to whether the D-Wave has bottomed or not.
And even stiffer test is going to occur as the stock market moves down into its intermediate bottom in March/April. If gold can't hold above $1523 as stocks move into a daily cycle low then it is going to get driven much lower during the intense selling pressure that will be generated when stocks move down into a larger degree intermediate bottom.
A couple of things to keep in mind.
The last C-wave was the greatest in both magnitude and duration of the entire secular bull market. Is it possible that a 2 1/2 year, 100%+ rally can be corrected with only a 38% retracement in four short months?
There is also the problem with the last intermediate cycle in gold running very short at only 13 weeks (normal duration is about 20-25 weeks). More often than not a short cycle is followed by a long cycle that evens out the next larger cycle. In this case the next larger cycle would be the yearly cycle.
If December 29th did mark an intermediate bottom then we would've had two intermediate cycles of only 13 weeks each. A short cycle followed by another short cycle is a pretty rare occurrence. In this case exceptionally so because the yearly cycle low isn't do until February/March. If I take into account nothing else I would have to assume that gold still has about 5 to 6 more weeks before the final D-Wave and yearly cycle low are formed.
That doesn't mean that gold has to drop a considerable distance below $1523. If it does turn out that gold continues lower into a more normal intermediate timing band I doubt that gold would move below the 50% Fibonacci retracement level, which is at about $1400. That also corresponds with the extensive consolidation zone in the summer of 2010.
One other thing to consider is the powerful correlation of a stronger dollar whenever the stock market moves down into a cycle low. We should continue to see the dollar spike higher over the next couple of weeks as the stock market drops down into its daily cycle trough, followed by a much more powerful rise during the intermediate degree decline due later in the spring. As you can see in the chart below gold has had little ability to resist a rising dollar.
So unless you think that the stock market will never drop down into a cycle low again, or that the market and the dollar will drop simultaneously (very unlikely), then gold is going to be severely tested as the dollar spikes sharply higher during the next few weeks and months as the stock market works its way down into first, a daily cycle low, and then a much more serious intermediate degree correction.
Right now investors need to be on the sidelines while we wait to see how gold handles the stock market's move down into its daily cycle low. If gold can hold above $1523 while the stock market suffers what is likely to be a rather sharp correction then the odds will improve dramatically that the D-Wave did in fact bottom in December.
If however gold follows the stock market down and breaches that $1523 pivot then the odds are very high that the D-Wave is still in progress and will not bottom until late February/mid-March.
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Re: Silver Phase Transistion
When Will Silver Reach a New High?
http://www.silverseek.com/article/wh...reach-new-high
Andrey Dashkov
| January 23, 2012 - 2:21pm
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Casey Research
In last week's Metals, Mining, and Money from Casey Research, Jeff Clark estimated that given the magnitude of the correction that started last September, it may take until May 2012 for gold to reach a new high. Let's take a look at how long it may take for silver to rebound.
It's a commonly known fact that silver is more volatile than gold. Already in this decade, silver has risen by a factor of 12 from its ten-year low ($48.70 vs. $4.07), while gold has seen about a sevenfold climb ($255.95 vs. $1,895).
This volatility – as you'll see in a minute – holds for corrections as well. On average, silver's retreats have been deeper and longer than gold's. The three big gold corrections we looked at last week averaged 22.8%. Take a look at the three biggest for silver, along with how long it's taken to recover and establish new highs.
The three biggest silver corrections in the current bull market average to 42.1%.
Our recent correction is the second biggest on record since 2001, but what really makes it stand out is the duration. The 2004 and 2006 declines took only five and four weeks respectively to reach their low points. And it was 31 weeks after the crash of 2008 that silver bottomed. Our current decline, measured from the peak reached on April 28, 2011 to its December 29, 2011 low, spans 35 weeks… quite the determined downtrend.
It also takes silver longer to recover than gold: gold's three biggest corrections required an average of 57 weeks and 6 days to regain their old highs, while it's taken silver's three biggest falls an average of 98 weeks and 4 days to catch up.
So how long will it take to recover from the 2011 slump? We don't know the future, of course, but the current correction is close to the average of the three in the chart, so let's apply the average recovery time to our current situation. The average 42.1% correction took 98 weeks and 4 days to recover; using the same ratio, a 46.3% correction would take 108 weeks and 3 days. Counting from the previous peak of April 28, 2011, we wouldn't break the $48.70 high until May 26, 2013 (based on London PM Fix prices).
It shouldn't come as a surprise that silver will take longer to return to its old high than what we found with gold in last week's article. Why? Half of silver's use is industrial, so a weak economy can drag down its demand. We certainly saw that in 2008.
And an exact date is pure conjecture, of course, and ignores fundamental factors that directly influence the price. 2011 is not 2008. In fact, we've already seen an interesting shift in investment activity in both gold and silver markets. The Silver Institute pointed out in a recent market report that "investor activity" was the biggest contributing factor to both last April's rally as well as September's selloff. Meanwhile, demand for physical metal has not only held firm but was projected by GFMS to reach a new record high in 2011.
Investment demand is rooted in the metal's monetary characteristics. It's not a stretch to say that we expect silver to regain its currency appeal soon, given the amount of worldwide fiat currency destruction. This will be perhaps the strongest catalyst for prices going forward. We wouldn't want to be without any silver.
If there's anything that sticks out from this bird's-eye view of the past ten years of data, it's that corrections are normal. And just as obvious is the fact that corrections end.
As with gold, the silver bull market is far from over, regardless of any weakness we may see in the near term. Don't be the impatient investor who gives up too early. And trying to time the market for a short-term profit shouldn't be the strategy in the midst of a long-term bull market. Instead, keep silver's fundamentals in mind: its industrial uses are growing and, like gold, silver is money.
That said, we believe that the window for buying silver at $30 won't be open for too long. The profit you someday realize from silver will be made buying now, when the price is low.
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
Please Read This Extremely Important Post
Saturday, February 25, 2012 at 3:57 pm
I hope you're ready. Everything that has transpired since May in silver and September in gold has led us to this moment. The next five to seven trading days will tell us everything. Either the metals will win their individual Battles Royale or they won't. If they win, price will accelerate to the upside. If they fail, the metals will likely settle into another sideways consolidation that lasts well into spring. I, for one, can't wait to find out!
So, let's get started. First, in case you missed it, here's a re-print of a comment I posted yesterday afternoon about the continuing increase of open interest in the metals:
"For yesterday, gold rose $15 and the April12 contract rose by 6,500 contracts to 264,250. Here's something interesting: The June12 OI fell by 1800 to 62,263. Hmmm. Total OI rose by over 4000 to 470,255.
You'll recall that yesterday was a big day for silver and also the day that the March options expired. First day notice is just 4 days away but March12 OI fell by just 3,600 contracts to 21,393. The May12 picked up a lot of rollovers and new money and grew by nearly 8,000 contracts to 49,471, a 20% increase in one day! Total silver OI is now 115,874 and that level is the highest its been since August of last year."
A short time later, I posted this comment, right after this week's CoT was released:
"Remember that massive OI jump during the rally on Tuesday? It was +17,000 contracts Tuesday alone and for the reporting period, the total OI rose a massive 25,000.
Well, we just found out how. Total spec long grew by 14,000 but the Cartel net short grew by 20,000! They are about to drop the hammer or get their nuts squeezed off.
Considering that OI has expanded by over 14,000 contracts in the two sessions since, you can imagine that the spec net long has continued to increase while The Cartel net short has done the same.
Silver, too. OI rose by 6000 contracts as the EE net short rose by 1900 and spec longs rose by 2100.
At first glance, this all just confirms that the stage for The Battle Royale has been set. We are up against it technically and the CoT shows that The Cartels are getting up against it from a net short perspective. Next week promises to be wild. Get ready."
Before we get to the charts and discuss the technical importance of this upcoming week, let's dive into that CoT a bit and look at some history for perspective. First, gold.
The CoT does indeed show a massive expansion of spec longs. 14,000 contracts! That's a lot of new money. It also shows that The Cartel supplied the new paper to those spec longs as The Cartel added 20,000 new shorts. The question is, as always, why do The Forces of Darkness do this? Are they:
- Flooding the market with fresh, unbacked paper gold because they are trying to cap price, suck in weak-handed longs and preparing for a massive raid through which they will profit? OR
- Is the bullion bank cartel simply performing their duty as a market maker? The specs demanded 14,000 contracts this week. Without a brand new, unbacked Cartel short on the other side of the trade, price would have had to have risen to the point where a current long was ready to sell. What would that price have be to in order to pair 14,000 contracts?
Have the bullion banks profited for years by naked shorting the PM "markets" and then initiating waterfall declines into which they can cover and profit. ABSOLUTELY! Is that what they're doing here. I don't think so. As I've repeatedly stated, I believe that The Cartels were completely freaked out and frightened by the events of 2011 and they have spent the last 10 months manipulating PM prices in an attempt to minimize and/or extricate themselves from their perennial short positions. What they didn't expect was $2T in fresh global liquidity in the past 90 days. As I laid out yesterday, everything is going higher, just like during overt QE2. Throw $2T around and it spills everywhere. Crude, gold, beans, cattle, copper...everywhere! The race higher is unfolding so quickly that The Cartels have been left with no other choice but to maintain their roles as market maker. Like the Specialists of old on the NYSE, The Cartels must take the "offer" side of the trade when things get disorderly to the upside, just like they must supply a bid when things are disorderly to the downside. (Though, during coordinated raids, The Cartels have obviously been reluctant to aggressively supply that bid.)
So, here we are. $2T with more to come are flooding the markets with liquidity and The Cartels are getting painted into the same corner they found themselves in last year. What will they do? Attack, of course! That's what they have always done and so you can imagine that an attack will be their first course of action here, too. But can they? Seriously...can they? Take a moment and consider the global investment landscape at this exact moment. Even if you had unlimited funds, would you want to continue building a huge net short position in the metals right now? I don't think so. And you'd have to greatly increase your short position to initiate an attack. No...I don't think they're going to attack, at least not in the massive, coordinated style to which we've grown accustomed.
Their only real option is to attempt to continue "managing" the demand. This means they will continue to create paper when demand is heavy and they will attempt to cover some shorts on every selloff. In an environment like that, you'd expect a steady, increasing, predictable price channel where demand remains constant and forces price higher within a channel of higher highs (demand surges) and higher lows (Cartel covering into selloffs). Hmmm. Do you think the environment I just described would look anything like these charts once you plotted all of the price action graphically?
http://www.tfmetalsreport.com/sites/...2-25goldd1.jpghttp://www.tfmetalsreport.com/sites/..._2-25silvd.jpg
So, how long can these price trends continue? As discussed in yesterday's post, from a fundamental standpoint the firehose of liquidity that is currently flooding the global markets shows no sign of slowing. The question then becomes, how long can The Gold and Silver Bullion Banking Cartels continue to provide the unbacked paper metal necessary to manage the ascent of price? Are they already stretched to the limit like they were last April in silver and last September in gold? If so, we can expect imminent attacks and margin hikes. For answers, let's consult some past CoT reports to see if we can gain some perspective. (For simplicity's sake, I'll start with the gross numbers.)
SPEC LONG 2/22/11 4/5/11 8/2/11 9/6/11 10/4/11 2/21/12
Silver 50,937 48,890 38,265 37,185 23,859 34,819
Gold 246,967 259,792 291,974 248,457 180,635 214,343
As you can plainly see, spec long positions in both gold and silver are still well below their peak levels in April and September, respectively. Additionally, though up considerably from the lows of Q4 2011, these markets are not yet "overbought", at least terms of market participation and liquidity. Now, let's look at The Cartel shorts.
BANK SHORT 2/22/11 4/5/11 8/2/11 9/6/11 10/4/11 2/21/12
Silver 89,728 89,827 75,029 77,869 58,807 70,923
Gold 389,757 415,992 442,648 401,815 345,040 375,306
Just as plainly, from a gross perspective, Cartel shorts are nowhere near the levels they were when silver and gold were making their respective highs last year. To me, this indicates that The Cartels have plenty of "ammo" still available from a paper supply standpoint. But, we have to look at the net numbers, too:
BANK NET (short-long) 2/22/11 4/5/11 8/2/11 9/6/11 10/4/11 2/21/12
Silver 57,793 56,414 44,588 47,216 18,923 39,188
Gold 234,804 258,665 287,634 227,714 164,751 229,302
As you probably expected, the net short position also shows that The Cartels have plenty of room to grow here as they are nowhere near the extreme levels attained at the price peaks last year. Other things to note from this data:
- From 2/22/11 to 4/5/11, silver rose from roughly $33 to $40 but the large spec long and Cartel net short positions barely budged. Why? The small specs drove the market as their net long position rose from 18,000 to 54,000. That's a triple of the small spec net long in 6 weeks.
- But it wasn't the specs that caused the panic, it was the EE. From 4/5/11 to 4/26/11, price rose from $40 to $48 but the large and small spec net position were both declining. However, over those three weeks, the EE net short position contracted by an amazing 14,000 contracts! The EE panicked, pure and simple.
- At that point, The CME stepped in and raised margins 5 times in 9 days
- From 8/2/11 to 9/6/11, gold rose from roughly $1650 to $1900. Though the media and the know-nothing paid disinformation agents of The Cartel would have you believe that this was a speculative "bubble", the numbers tell a much different story. Over this time period, the large spec net long position declined by almost 25% from 247,175 to 184,371 and the small spec net long only increased by an insignificant 3,000 contracts, rising from 40,459 to 43,343.
- Again, this "panic" was caused by a cartel, The Gold Cartel. From 8/2/11 to 9/6/11, price rose $250 as the net short position of The Gold Cartel declined by a whopping 60,000 contracts, falling from 287,634 to 227,714. What happened to instigate this panic? The S&P downgrade of U.S. debt on 8/5/11.
- At that point, central bank intervention drove gold lower in the wee hours of 9/6/11 and the raid was on. The CME also conspired to raise margins in gold, too, thereby increasing the selling pressure.
All that history notwithstanding, it's clear to me that we are still in the early stages of this rally. With this history as our guide, PM prices will continue to ascend in two legs. This first leg is the ongoing expansion of large and small spec net long positions. These numbers will probably continue to grow until they begin to reach the levels attained in April and September of last year. The second leg will be another Cartel panic leg where prices rapidly surge to the upside. Since I think we are still in the middle stages of Leg #1 and, since global liquidity should only continue to surge, I just don't see a huge risk of a coordinated C/C/C smashdown at the current time.
That said, we can't be complacent, either. The charts are at a very significant juncture and silver lease rates are scary-low so a raid, particularly in silver, cannot be ruled out. Ignore the silver lease rate chart below at your peril. I don't think it's a direct indicator of an impending raid but even Stevie Wonder can see the obvious correlation between the last two forays into deeply negative territory and steep price selloffs.
http://www.tfmetalsreport.com/sites/..._2-25lease.jpg
And now here are your charts. As you can see, we are now at the Battle Royale...the points at which gold and silver will either be forced to reverse or they will overcome this last line of resistance and charge higher. My point in dissecting all of the CoT data was to help you see why I feel that the Battles Royale are going to be won not lost and that, after a likely period of serious volatility over the next 5-7 trading days, gold and silver will begin accelerating higher. First, here are your gold charts showing the same view but from different angles.
http://www.tfmetalsreport.com/sites/...25goldd1_0.jpghttp://www.tfmetalsreport.com/sites/...2-25goldd2.jpg
http://www.tfmetalsreport.com/sites/..._2-25goldw.jpg
And here are your silver charts. Note that silver is fighting two technical battles. There is the horizontal resistance from the recovery highs of late October (35.50) and there is also diagonal resistance from the down-sloping trendline connecting the highs of April and September (about $36). When silver is able to move through and close above both of these two lines, it will be off to the races for a while as there won't be much resistance until price reaches $40.
http://www.tfmetalsreport.com/sites/...-25silvd_0.jpghttp://www.tfmetalsreport.com/sites/...-25silvdw1.jpg
http://www.tfmetalsreport.com/sites/...-25silvdw2.jpghttp://www.tfmetalsreport.com/sites/...2-25silvd2.jpg
In closing, let me just say that I sincerely hope you enjoyed reading this as much as I did writing it. It's not exactly how I intended to blow my Saturday but I felt it was imperative to get this information to you today so that you could study it before Monday. The next 5-7 trading days are very, very important and if you don't approach them with a plan, you will instead be prone to acting on your emotions and, as we all should know by now, letting your emotions get the best of you is about the only way you will lose fiat money trading gold and silver in this remarkable, continuing bull market.
Keep the faith. Be patient. Have courage. Believe in yourself. Prepare accordingly.
TF
http://www.tfmetalsreport.com/blog/3...important-post
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Re: Silver Phase Transistion
Does this mean that between $33.50 and $34.50 is the lowest silver is likely to go before continuing to go up (and that's only if there's a raid)?
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Re: Silver Phase Transistion
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With gold near $1,770 and silver near $35.50, today King World News interviewed James Turk out of Spain. Turk told King World News the fact that silver is not pulling back is an indication of how strong that market is right now. Here is what Turk had to say about the situation: “This is a great start to the week for the precious metals, Eric. We need to see this kind of strength to make sure both gold and silver follow through in the next few trading days to confirm the big gains from last week where gold climbed 2.9%, while silver soared 6.4%. It is remarkable to see both metals hold their gains with no profit taking. Clearly, traders see something big is about to happen, and so do I.”
“In this regard, I have mentioned several times my expectation that once resistance at $35 is taken out, silver will climb to $68-$70 in 2 to 3 months. I still expect that outcome, but of course, only time will tell. I thought it might be tough going for silver in the $35-$36 area, but maybe not based on the strength we are seeing today.
But regardless, Eric, I expect the silver price will begin to accelerate to the upside once $36 is hurdled. In many ways silver is positioned today like it was back in the summer of 2010. Long-time KWN listeners will remember the events from back then and my bullish views about silver. I feel the same way today.”
When asked about gold, Turk responded, “We spoke in the last blog about the relationship between oil and gold, which was up 2.9% last week. Oil jumped a remarkable 6.3%. With all the money printing going on in central banks around the world, not to even mention the growing tensions in the Middle East, oil looks ready to test its record highs some time this year....
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“So KWN readers have to remember that right now so goes oil, so goes gold. It is also quite possible that gold will outperform oil by the end of the year. But the bottom line is the wind is at the back of the bulls in both the gold and oil markets.
I follow this like you do, Eric, on a daily basis, but I look at it differently. I look at the price of crude oil in terms of gold and since the beginning of 2012 gold has been outperforming crude oil. This relationship between oil and gold goes back decades. Today an ounce of gold buys basically the same amount of crude oil it did 60 years ago.
But you do get some fluctuations in this relationship and right now I expect the purchasing power of gold to increase. What I am saying is that an ounce of gold at the end of the year will buy more oil than it does today.
I am a firm believer in letting the market tell its own story, Eric. The market does this with the movement in prices. Then, if we watch closely, we can see important trends. By jumping on those trends and riding them, you position yourself in harmony with what the market is telling you, which is important.
You always want to be in harmony with the major trend in prices. As they say time and again, never fight the market. So here's the point I am making, Eric. Events so far this year have been extraordinary. The markets are signaling it. In reality, events are spinning out of control.
Despite this new bailout scheme being foisted on Greece, the situation there continues to spiral out of control, which is one of the factors causing confidence in the safety of European banks to continue eroding.
Surprisingly, over the weekend, the Telegraph in London reported comments by George Osborne, the British Chancellor, who said, ‘The British Government has run out of money because all the money was spent in the good years.’ Finally, a political leader came out and said what everyone has been ignoring. While I applaud Osborne for telling the truth, the frightening reality and what everyone has been ignoring is governments around the world are broke.”
This is why it is so important to be outside of the banking system by having a portion of your assets in physical gold and silver. Governments are broke and much of the banking system is insolvent.
http://kingworldnews.com/kingworldne...26_Silver.html
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Re: Silver Phase Transistion
Quote:
Originally Posted by
jbeck57143
Does this mean that between $33.50 and $34.50 is the lowest silver is likely to go before continuing to go up (and that's only if there's a raid)?
Predicting price movements in silver from charts is difficult but the turd gives it a go and yes that is what he means,going by the shaded in area.
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
“I think scarcity in oil is a dramatic tailwind for gold. Politicians will inflate. They don’t want oil to bring down the economy like it did in 2008. Remember, this inflation will take place with commodity prices already high. So this will create significant inflation.
Today acclaimed money manager Stephen Leeb told King World News that gold is already the de facto reserve currency in the world. Leeb also said oil is headed much higher and soon the Chinese will look to make a move in the silver market. Leeb is Chairman & Chief Investment Officer of Leeb Capital Management. Here is what he had to say: “I am not surprised there are no significant pullbacks in gold. I think it’s essential that individuals own gold here. The gold market definitely wants to power ahead on a short-term basis. I don’t think you can separate oil, gold and copper from one another.”
This means higher gold and silver. Gold at $3,000 by the end of the year, easy. Silver $60, $70, easy. What else do you buy? What currency do you buy? Do you buy the euro or the dollar when we are inflating? You can’t buy the Chinese yuan because it’s not freely traded.
Do you buy the yen with the Japanese pumping money into their economy? There are no other answers. Gold right now is the de facto reserve currency in the world....
Governments from China to India, to most all governments, except those in the Western world, want to assure they have enough gold on hand. It’s just that simple.”
When asked about the move in oil, Leeb replied, “We’re sitting here in this country saying fracking is a solution. Fracking is no solution. Fracking buys us maybe a year or a year and a half. The amount of reserves we have in these shale deposits are smaller than we had at Prudhoe Bay. They are also much harder to cultivate.
If you look at the production profile of the US over the past 40 years, you see a little blip associated with Prudhoe Bay. It barely even makes a dent. Even with Iran still exporting their 2.2 million barrels per day, the OECD right now is at sixteen year lows.
Now some of that is because Saudi Arabia doesn’t have it. There is no doubt in my mind that China sees the writing on the wall and they are socking away a lot of this oil.
Right now this country is lost. What we are likely to see here in the US is the Obama administration, politics being what it is, will probably release oil from the strategic reserve. We have already heard a little bit of talk about this. This, in my mind, is as dumb as it possibly can be.
The reserve should only be used if there is armed conflict with Iran and subsequent turmoil in Saudi Arabia. Then you really need that oil. This oil should not be used to get somebody elected. Improper usage of this oil would be a terrible mistake.
Oil, left to its own devices, without any talk of the strategic reserve, could go anywhere on the upside. Oil could easily go up to $130, $140, $150. If the Saudi oil fields are shut down temporarily, there goes 9 1/2 million barrels per day. How do we make that up?
If we do see oil dip because of a release from the strategic oil reserve, buy it. Buy oil and buy gold on that kind of news because it is so short-sighted. If we release from the reserve do you know who will be buying it? China. We will be giving a gift to China.”
Leeb also added: “China is also going to increase their consumption of copper. China’s copper consumption has been growing at about 3% to 4% per year. It should grow 6% to 7% per year over the next five to ten years. It’s not about economic growth in China. What China is doing is spending massive amounts of money on smart grids and alternative energies.
I also believe the Chinese are going to start accumulating massive amounts of silver again. They will stockpile silver the same way they are aggressors in the copper market. The other plus for silver is the ‘monetary’ plus. More and more investors are beginning to recognize silver, once again, as a monetary metal.”
http://kingworldnews.com/kingworldne...26_Copper.html
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
London Trader - Massive Physical Silver Orders Filled Near $33
March 8, 2012
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The London Trader continues:
“The Chinese are doing the exact same thing in the silver market that they are doing in the gold market, massive accumulation on dips. It is also important to note that the local traders in silver are short and nervous. Everyone is short silver and so that market can move violently higher when it turns.
When silver reverses, it will be the one that leads the market higher. Also, the commercials have been covering in silver the same way they have been in gold....
Continue reading the London Trader interview below...
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“The physical silver orders that were just filled have been waiting since February 16th. Those orders near the $33 level were filled in huge size on Tuesday. These long-term accumulators are buying every dip. There were some fills at $34, but some very large orders were filled near $33.
As long as we stay under $34, there is going to be constant accumulation. What does it matter if you buy silver at $32 or $38, when it is going to go multiples higher from these levels? The Chinese know this and that is why they are accumulating in size.
What is happening here is essentially criminal, but the smart money is capitalizing on it by accumulating. They take advantage of the manipulation. Remember, a lot of this is spot indexing that will be converted to physical over the next few days.
These guys (bullion banks) are so naked short and the last thing they need is to have physical disappear at this time. This is the ammunition they have to drive the market lower and they don’t have very much ammunition.
Even in the virtual market they are running out of sellers they can cover into. There simply aren’t enough weak hands for them to cover in size and as I said, the last thing they need is for physical to be disappearing at these levels.
The real (physical) market is taking over now and the virtual (paper) market will not be as important going forward as the price of silver begins to rise again.”
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Re: Silver Phase Transistion
I have received numerous emails asking about silver. This article was prompted by a question enquiring what the silver price might be if my gold forecast of $4,500 proved to be correct. As I own some silver bullion and a number of silver mining shares, the question caused me to pause and take a closer look at silver. The reason why I have written very little about silver in the past was because the beautiful Elliott Wave (EW) symmetry and predictable relationships visible in gold were not to be found in silver. I first wrote about silver in December 2003 in an article titled "US Dollar Implosion - Part II". The link to this article is at: www.gold-eagle.com/editorials_03/field120503.html. The brief piece on silver was tacked onto the end of that article. In view of its brevity, the 2003 silver piece is reproduced in full below:
SILVER
"In past crises, the wealthy protected themselves by purchasing gold and gold related assets. Ordinary people, by far the greater number, could rarely afford to buy gold. Being far cheaper, they previously had to buy silver. This metal became the poor man's choice as an asset to protect their savings. Silver has so far lagged gold in the early stages of this bull market, but that situation seems about to change."
"Throughout recorded history the average relationship between silver and gold has been 15oz silver to 1oz gold. The ratio at present is a far higher 75:1 ($400/$5.30). This is massively out of line. If gold were to double to $800 per oz, it would not be unreasonable to expect the silver/gold ratio to decline sharply, possibly as low as 40:1. With gold at $800, this would position silver at $20.
Thus a 100% increase in the price of gold could possibly be accompanied by a simultaneous 400% increase (perhaps more) in the price of silver. This offers significant opportunities both in silver bullion and silver mining shares.
The above graph of the price of silver has been borrowed from an excellent recent article by Dan Norcini entitled "A Technical Look at Silver - Update". What is quite clear from the graph is that silver's 22-year bear market down trend has come to an end. As Dan Norcini says, a new bull market in silver has been born. It is difficult to argue against this contention and I have no intention of doing so. A silver price above $6.80 would complete a fabulous head-and-shoulders base formation. With this as a foundation, it would be possible to project a very large rise in the price of silver for the future." - end of the December 2003 quotation.
Silver did reach $20.68 in March 2008 at the same time that gold peaked at $1003. The silver to gold ratio was thus 48.5 in March 2008. The lowest this ratio has reached is about 32, achieved at the end of April 2011 when gold was around $1570 and silver peaked in the $49 area. At that point gold had experienced a 6-fold increase from its bull market starting point of $255 while the silver price rose 12-fold from its bull market starting point of $4 in November 2001.
The quick answer to the question of what the silver price will be when gold gets to $4,500 is to pick your favorite silver/gold ratio and divide it into $4500. The current ratio incidentally is about 51. If you choose the lowest ratio achieved since 2001 of 32 that would produce a silver price of around $140 ($4500 divided by 32).
This is not a satisfactory answer, so I decided to approach the Elliott Wave analysis of silver from a different angle. Instead of working upwards using the analysis of the minor waves, which was the technique used in the gold calculations, what if we worked backwards in silver starting with the larger waves?
Gold and silver tend to move in tandem, not in an exact synchronization, but enough to suggest that the Major waves of both metals should coincide from a time perspective. We know that in gold the Major ONE wave peaked in March 2008 at $1003 and that Major TWO declined to $680 in November 2008.
Silver also had a peak in March 2008 at $20.68 and declined to an important low of $8.77 in November 2008. If we assumed that the peak at $20.68 in March 2008 was the end of Major ONE and the decline to $8.77 the end of Major TWO, how would the various percentages work out? When I did these calculations I was astonished at the relationships and wave counts that emerged.
The chart below is the monthly spot silver price shown in log scale so that the percentage changes are visible. The bull market started in November 2001 at a price of $4.02. From that point to the suggested peak of Major ONE at $20.68 there are five clear waves visible, marked 1-2-3-4-5. The prices at the various turning points are also displayed.
The analysis of the suggested Major ONE wave is set out in the body of the chart. The typical impulse wave relationships are immediately apparent. Both corrective waves 2 and 4 are similar (-33.7% and -35.9%). Whenever two corrective waves are similar it is a signal that they are part of the same larger wave structure. On its own, this fact would confirm that the 5 wave move from $4.02 to $20.68 was a complete wave of larger degree.
There is further corroborating evidence. Waves 1 and 5 are similar at +106% and +115%, a usual EW feature. Wave 3 should be the longest wave, and it is at +171%. In addition, if one multiplies the gain in wave 1 of +106% by 1.618 it produces 171.5%, exactly the gain in wave 3. These relationships are evidence that the rise from $4.02 to $20.68 is a completed impulse wave and that we can call it Major ONE.
Having completed this 5 wave up move, the next correction in Major TWO would be expected to be one degree larger than the two corrections of 33.7% and 35.9% in Major ONE. As shown on the chart, Major TWO declined from $20.68 to $8.77, a loss of -57.6%. The two corrections of 33.7% and 35.9% are close to the Fibonacci 34. The next higher number in the sequence is 55, close to the actual decline of 57.6% in major TWO. Incidentally, if we take the 35.9% decline and multiply it by 1.618, it gives a figure of 58%, very close to the actual decline of 57.6%.
These relationships suggest that silver has completed the same shaped bull market as gold has and that it is at the same stage in its development. Thus silver has probably also completed the first intermediate up wave of Major THREE, in this case from $8.77 to $49.52, a gain of +$40.75 or +464% and has also completed intermediate wave 2 of Major THREE, being the decline from $49.52 to $26.39 or -47%.
How does this decline of -47% measure up in terms of EW relationships? As with gold, where the corrections in Major THREE were shown to be larger than the corrections in Major ONE, the same applies to silver. The corrections in Major ONE shown in the chart above were close to -34%. If we multiply 34% by another Fibonacci relationship of 1.382 we get 47%!
This is mind-blowing stuff for an analyst who did not believe that EW applied to silver!
We can now attempt to make some price forecasts. Silver, as with gold, is starting intermediate wave 3 of Major THREE, which should be the longest and strongest wave in the bull market. It should certainly be longer than intermediate wave 1 which was the gain from $8.77 to $49.52, or +464%, as shown above.
Thus the gain in wave 3 of Major THREE should be larger than +464%. It should be a gain of at least 500%. Starting from the $26.39 low, a gain of 500% would produce a target price of $158.34 for silver. That is the number which equates with the $4500 price forecast for gold and produces a silver to gold ratio of 28.4 ($4500 divided by 158.34).
The gain in gold was forecast to be 200% for this move while the forecast rise in the silver price is 500%. Silver is again predicted to perform better than gold based on these EW calculations.
A word of caution is appropriate at this stage. All EW studies are based on probabilities. While the wave counts may provide a high degree of confidence in the forecasts, one cannot be 100% certain of any forecast. It is necessary to have a point at which it is obvious that the forecasts are wrong. In the case of this silver study, the line in the sand is at $26.00. If the silver price drops below $26.00 the odds are that the above calculations will not work out.
A further word of caution: silver is not for the faint hearted. Silver is considerably more volatile than gold and the corrections are much larger. Silver corrections can and do happen quickly. They are emotionally gut-wrenching and it is easy to get shaken out of one's position near the bottom of a large correction.
Alf Field
1 February 2012
http://www.gold-eagle.com/editorials...eld013112.html
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Re: Silver Phase Transistion
Fractal Analysis: 2012 Silver to $70++
Goldrunner
| March 29, 2012 - 8:58am
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Around this point in the fractal cycle in the late 70’s, Gold busted out of its channel to rise sharply higher, along with Silver. Silver’s channel top will lie up around $68 to $70 over the coming months which we believe will be reached in 2012. The next higher angled resistance bands for Silver run from $112 to $115, and then up at the $123 area. By the end of the Silver Bull, we expect to see Silver reach $500+.
Dollar Devaluation Drives The Fractal Relationships
The fractal relationships to the late 70’s are driven by the aggressive Dollar Devaluation in both periods, with the current period one Elliott Wave Degree higher.Both periods present as pure 5th wave parabolas in Dollar Devaluation, and thus, in the Gold and Silver Charts.We are seeing a price expansion in the current Vth wave versus the 5th wave of III in the late 70’s for Gold and for Silver.
We have noted for years that the Fed “owns” the psychology of the markets.The Fed is in the process of converting the Deflationary K-Winter into a period of Stagflation.“Stag” refers to the very sluggish economy, and “flation” refers to rising inflation created by the aggressive Dollar Devaluation.
The Fed and its banks blew out the loan multiplier system for providing new Dollars directly into the economy in 2007 and 2008.The 2nd round of Dollar Inflation is via the Fed printing new Dollars to buy US Government debt- pure debt monetization and default on debt.Thus, they are devaluing the huge load of debt by devaluing the US Dollar.
The Fed “shows inflation when it wants” and it “shows deflation when it wants.”It does so by suggesting that it will, or will not be printing Dollars, the liquidity that drives the markets.All of this jawboning is a joke since the Fed has no choice but to print Dollars at an accelerating rate yet, the markets and investors run a constant bi-polar gauntlet by taking the Fed at their “word.”
The big trading banks dominate the markets.They do the “bidding of the Fed at key junctures.”This is a process of rotating liquidity into the different asset classes that must be supported in the process of changing the cycle during the 2nd leg of debt monetization.
It is the devaluation of the US Dollar that ultimately creates the price rise in Gold, in Silver, and in the PM Stocks.The only true read on the Dollar Devaluation is through the rise of $Gold so the true devaluation of the Dollar can be hidden from the market at key times.In reality, it is the market that creates the devaluation of the Dollar against Gold creating the Gold Parabola so the psychological whims of the Fed can muddle the psychology of the markets.The Gold parabola rises in fits and momentum runs as the market devaluation of the US Dollar ebbs and flows around the psychological effects of what the Fed says; accompanied by the help the Fed receives from entities trading with the Fed’s words.
The spastic Gold market is also affected by a focus on the Dollar Index that has little to do with Dollar Value once Global Competitive Currency Devaluations start in earnest.
We Can Expect QE to Infinity
As Jim Sinclair says, this is complicated stuff.Per Mr. Sinclair we already have approximately $1.3 trillion that were printed and sent to Europe.The markets have not factored this into the price of Gold, yet.Once it does, we should see Gold rise sharply.Remember that it only took $600 Billion of new QE printing to drive Gold up to $1920 in 2011 as per my forecast back in January and April, 2011 in my article entitled Goldrunner: Gold on track to Reach $1860 to $1,920 by Mid-year(gold reached $1,917.20 in late August, 2011 and $1,923.70 in early September, 2011).
All of the US Debts must be on the US balance sheet before Gold goes completely parabolic, for full devaluation of the Dollar and the debts.This is the essence of the question that a Congressman asked Tim Geithner.Tim delayed until the Congressman tossed out the $20 Trillion and then $50 Trillion numbers.Mr. Geithner responded that the number would make the Congressman “uncomfortable.”GEITHNER IMPEACHED BERNANKE’S COMMENT ON “MAYBE NO MORE QE” WHEN HE BASICALLY ADMITTED WE NEED QE IN SPADES GOING FORWARD.Mr. Geithner confirmed that the number of Dollars that must be printed to cover off-balance sheet items is huge.This covers items like unfunded Social Security, unfunded Federal Pensions, future unemployment claims, and the losses of Fannie and Freddie through the end of 2012.
Unfortunately, investors generally keep looking at the trees on a short-term basis, rather than seeing the forest of Dollar Devaluation.As Jim Sinclair constantly notes, we will see QE to infinity.This means that Gold will go vastly higher than most expect in order to devalue the debt and to balance the US budget.
The current markets are completely managed by the Fed and its henchmen.The complete management is a complicated issue as Jim Sinclair has noted. For instance: the Fed and its helpers recently inhibited Gold and Silver at a time when the Greek debt issues were being worked out.It was the Fed’s helpers who had sold the OTC Derivative “insurance” on all of the failed Greek debt.It appears that they hammered inflation expectations to help the deal from go smoothly; and there were cycle timing issues that were already stretched a bit.In reality, most of the Greek Debt holders were forced to take on a different debt series before “default” was declared for a final few.This gives us “insight” that the time in the cycle is short, due to the necessary quick fix deal.
Mr. Sinclair has discussing how the US Dollar’s days as the World Reserve Currency are numbered.This begs the question of what effect this will have in terms of the Dollar’s “value.”Personally, I think that new Dollar Supply is most important, but freeing up huge numbers of Dollars with its loss of reserve status could be a reason for a sharp rise in US inflation if all of those Dollars head home - and a large number of those Dollars coming home to roost might find themselves “chasing Gold and Silver” which could add to the process of the markets re-valuing Gold and Silver much higher.
We are seeing a “price expansion” in the charts of Gold and Silver in the current period with little evidence of a “cycle time expansion” to go with it, other than the general increase in fractal time warranted at one higher Elliott Wave Degree.
In the late 70’s the top in the Gold Chart came as a momentum high into early 1980 with a lower final high coming later.It is possible that we will not see the momentum high before the final high this time, yet it is probable since the continuing deterioration in the economy demands a fairly quick devaluation of the debt before the economy completely rolls over.
The first chart of Silver is the current log chart where Silver is trading inside the black trend channel.We can see the exaggerated decline into the deflation scare bottom in late 2012.Silver appears to be correcting in a flag formation at this time.The measured target of a flag break-out to the upside would target the $65 to $70 area at the top of the black channel.We have break-outs on the RSI and the MACD with the RSI trying to hold the Bullish 50 mark.The Fed has already printed $1.3 Trillion to go to Europe, with more QE necessary to buy US Debt.As the markets factor the Dollar Devaluation in, we’d expect to see Silver explode upward on a fundamental basis.It only took $600 Billion in 2011 to drive Silver from around $20 up to around $50.Additional QE to buy US debt would suggest about 3 times the 2011 Dollar Devaluation from Dec. of 2011 to the end of 2012.The timing appears to be supported with this being a Presidential election year.
If you would like to have access to my detailed proprietary fractal analyses of what is likely to unfold for Silver, Gold, Copper, the HUI and a large number of specific mining company stocks in the months and years to come, the link to our subscription service at the bottom of the article (only $30/mo.). If you do not want specific information but would just like to keep abreast of my general views on the markets, you can send an email requesting to receive my coming free newsletter Goldrunner’s Fractal Corner. See the bottom of the article for further subscription and newsletter contact information.
The Current Silver Bull Chart
The Late 70’s Fractal Silver Chart
The next chart of Silver is an arithmetic 70’s chart.There was no “deflationary bent” in the late 70’s that caused the steeper retracements we have seen in the current period to create increased volatility in the ever expanding environment of Dollar Devaluation, yet it is obvious that we have not seen the first wave of sharp price expansion in Silver that occurred in the late 70’s.Fractal Cycle timing suggests that it should be directly in front of us, and it appears that the next round of aggressive Dollar Inflation is already underway to fuel that type of move as soon as the market factors the aggressive round of Dollar Devaluation into Gold and Silver.
The Silver Parabola is not a smooth flowing form like the Gold Parabola is (as can be seen in a previous article here).We can see that the huge price rise in Silver came almost completely toward the tail end of the 70’s Bull.
We are still in a short-term period of potential cycle weakness until options expire for Silver and Gold futures into the end of this week – but the Fractal Cycle suggests that things will heat up soon to see Silver on its way to $70+ in the next up-leg. We have previously laid out our fractal expectations for Gold in 2012 via our article,Goldrunner: Fractal Gold Analysis Says Gold On Way to $3,500 Mid-year.
For the moment,
Goldrunner, THURSDAY, 03-29-12
http://www.silverseek.com/article/fr...2012-silver-70
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Re: Silver Phase Transistion
Manipulated Markets Can’t See the Future
-- Posted Wednesday, 16 May 2012 | Share this article | Source: GoldSeek.com
By David Nichols
Right now we are all in the unfortunate position of being hostage to the dubious forecasting abilities of the Fed and other Central Bankers, as if they are not proactive in putting in place another round of easing, just about every financial market will plunge.
Even though it seems like they've done so much already -- and there is political pressure on them to let up -- once they started down this path then there was no choice but to keep increasing the flow of new currency. This is a big monetary experiment spiraling out of control.
There is little doubt that gold will be much higher into the cycle peak scheduled for mid-2013, but there is cause for concern about a hyper-deflationary episode prior to that run up, similar to the Lehman debacle in late 2008. Of course markets will rally right back when the Fed reacts with a huge liquidity push, but once the chaos starts, the damage will be unpredictable.
http://67.19.64.18/news/2012/5-16dn/image001.png
Theoretically the gold market should be able to “look beyond” these sorts of liquidity concerns, with the precognitive forward-looking ability that markets usually possess, because there is little doubt about how central banks will respond -- with a fire hose of freshly-minted dollars, euros, yen, renminbi, and soon enough, even new drachmas.
But it does seem like this Fed-based market environment has brought on a major contraction in the ability of markets to discount the future. Markets are seeing forward only a few weeks into the future, instead of months, or even years ahead, as they have in the past.
My theory is essentially every financial market is currently not experiencing proper price discovery, due to massive manipulation by central banks. This is especially true for bond markets and currencies, and by extension, gold. After all, what is quantitative easing other than the Fed intervening in the bond market to buy bonds? And they are an unnatural buyer. They don’t buy to capture profits or hedge existing positions, as market participants are supposed to, and they aren’t using currency backed by labor and savings – they are, quite literally, using “monopoly money” of their own creation.
Their interventions in bond markets are influencing the price discovery mechanism that functions so well in freely-traded markets, and is therefore contracting the market's ability to properly discount the future.
Because of this we should expect more volatility in the months ahead, as this “short-term syndrome” becomes even more heightened with further Fed interventions into the markets.
It would not be out-of-character in this environment to see a big drop in most markets -- with everybody screaming about deflation -- to be followed by a huge rally, with everybody then screaming about hyper-inflation. Opinions will be changing rapidly, based entirely on what the market is doing, and not based on a coherent view of the future.
This is why the underlying cycle energy, which is especially critical in the gold market, will have such a massive influence into the next 21-month peak.
Over the past month I have undertaken an exhaustive study of this long bull market in gold, to further unravel the structure of its price patterns and timing cycles, with a specific emphasis on studying the timing cycle that has caused a peak in gold every 21 months.
Sometimes when you look in hyper-focus on a subject, the results can be disappointing. But this was decidedly not the case with gold, and I looked at -- quite literally -- every trading day since 1999. This bull market pattern has been highly precise in its timing and structure, and I believe this structure will only become more precise into mid-2013.
I have just put the finishing touches on a lengthy Special Report on the gold cycle into 2013. In this report it became necessary to venture into topics that I have not previously discussed regarding the "how and why" of cycles in both the natural world, and in financial markets.
http://67.19.64.18/news/2012/5-16dn/image002.png
These are my own theories that I have been developing and working on over the last 5 years, and they have wide-ranging implications, beyond just financial markets.
It became necessary to introduce the basics of these ideas on why cycles form in just about every facet of life on earth, to frame some important points about the gold cycle into mid-2013.http://news.goldseek.com/GoldSeek/1337194415.php
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Re: Silver Phase Transistion
Silver Update
Hubert Moolman
| Wednesday, August 22nd
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The silver chart has formed a big pennant like that of the gold chart. What this indicates is that the silver price will likely make a massive move soon. Technically, this move can be up or down. Note that this update is from my premium service originally published on 6 August 2012.
Below is a silver chart with the pennant:
http://67.19.64.18/news/2012/8-22hm/image002.jpg
The technical and fundamental evidence that I have collected, and look at, tells me that the price is likely to go upward out of this pennant formation.
On the chart above, you can see that the price has actually broken out (upward) of the pennant. We have to give it some time before we can say that it is a valid breakout. Also, I have drawn a blue line, which could become another area of resistance.
If we were to consider a move down, then a first target of $15 and one lower at $5 would come into play, based on the patterns. A price of $5 (and even $15) does not make any economic sense, given the amounts of fiat money currently available.
However, there is a real threat of deflation, currently, and the effect of this has to be considered when looking at the future silver price. In my opinion, we do have a perfect setup for a massive deflation which will destroy a lot of debt-based value.
Stock market values have been driven for years by this debt-based value, and will, therefore, be very badly devalued. Many believe that such a fall in stock market values will take down the silver price. I do not agree, and have given many reasons why.
Here, I would just like to point out that the current threat of deflation is due to the massive debt levels, and the inability to service those debt commitments. You can just look at the example of Spain or Greece.
Silver is a real store of value and that is its most significant function. The current crisis will cause a massive rush to that which can store value that will not be destroyed by the debt-collapse. Silver is just about the opposite of debt.
Previously, I wrote about how this debt-based monetary system has created what I call a “mirror-effect”, whereby, silver (and gold) is pushed down in value, to a similar extent as to which paper assets such as general stocks are pushed up in value. This mirror-effect clearly shows up on the long-term charts of gold, silver and the Dow.
Below, is a long–term silver chart (real and nominal) from 1850 to present (generated at minefund.com):
http://67.19.64.18/news/2012/8-22hm/image004.jpg
I have drawn a vertical red line, approximately where silver was demonetized (1870s). Notice how the real price of silver collapsed after the red line, from about $30, until it bottomed in 1931 at $4.29. It then traded side-ways (from the big-picture view) for many years, until it spiked from about the early 1970s, making a peak in 1980, where after, it bottomed again in 2001.
Technically, the bottom in 2001 was the completion of what would be a remarkable double bottom reversal, with the first bottom being in 1931. After a double bottom formation, there is often a big rally, and that is exactly what happened next. If this pattern continues to follow the pattern of a valid double bottom, it will reach levels that will exceed the 1980 high by at least one multiple, but probably by many more.
The interesting thing about this possible double bottom is the fact that the two bottoms came 70 years apart. This 70 years period also appears on the long-term Dow chart. Below is a Dow chart (from stockcharts.com) from 1900 to present:
http://67.19.64.18/news/2012/8-22hm/image006.jpg
On the chart, I have indicated a 70 year period from when the Dow peaked in 1929, to the peak in 1999. The reason for using the 1999 peak instead of the 2007 peak, is the fact that the 1999 peak represents the real peak, since the Dow/Gold ratio peaked in 1999 (like it did in 1929).
Notice the dates of the peaks and how they fit in with that of the bottoms of the real silver price, as well as the similar 70 year periods between. In my opinion, the occurrence of the 70 year period on both charts, in the context as explained above, provides additional evidence of the link between silver’s demonetization (or suppression) and the massive debt bubble of this century – as explained in part 1 of this article.
While the Dow is inflated to the peak in 1929, silver is suppressed to its low in 1931. And again, the Dow is inflated to its peak in 1999, while silver is suppressed to its bottom in 2001.
So, the peaks and troughs, as presented in the above charts, are the manifestation (in visual form) of the debt-based monetary system causing paper and related assets to rise, while suppressing silver. Another way of looking at it is that the debt-based monetary system is fuelling speculation in paper assets by using energy diverted from precious metals.
Silver (like gold) stands in direct opposition to the current monetary system (they are inescapably linked). The fall (and falling) of this system is the rise of silver as money; therefore, massive increases in what silver can buy in real terms.
Looking at a bearish pattern to find critical levels
Below, is 6-year chart of silver, highlighting bearish fractals:
http://67.19.64.18/news/2012/8-22hm/image008.jpg
I have highlighted two fractals by indicating 4 similar points on both. Based on this comparison, we could now be at a very critical area. A break-down below the support (about $26), could mean that the current pattern could follow the 2007/2008 pattern, and take price much lower. This is presented not because I believe that price will break lower than the support, but to show why I think we are at a critical level, and why we should be watchfull.
Pattern Previously Covered
Here, is a follow-up on my previous article about the similar flag-type formations on the silver chart.Below is a graphic which compares the current pattern on silver (from about the beginning of 2011 to present) to a 2007 pattern:
http://67.19.64.18/news/2012/8-22hm/image010.jpg
This comparison is still very much valid; only if price goes lower than $26 could it become invalid. In fact, there is a good chance that price has broken out to the upside.
On both charts, I have suggested how the flag patterns might be similar, by marking similar points, from 1 to 6 (and alternatively from a to h). Based on this comparison, it appears that the silver price might now have found that point 6 or h (at the end of June), and is about to increase significantly.
We could be at very volatile area due to the possible breakout, since this is often the case after a breakout – so be aware! I am of the opinion that silver should make its move higher between now and the end of this month, if this comparison is to be confirmed.
Follow-up on Gold/Silver Ratio
In my last gold update, I covered the Gold/Silver ratio, and explained why I think the Gold/Silver ratio will soon fall straight down. Below is an updated Gold/Silver ratio chart:
http://67.19.64.18/news/2012/8-22hm/image012.jpg
On the chart I have indicated a trading channel in which the ratio has been moving for the last five months. It appears now to have finally broken down, out of the channel. This could be a very strong signal that silver and gold prices are about to rise significantly. Again, here we have to watch for a possible retest of that break-down area, before the ratio falls straight down.
Conclusion:
Silver appears to have broken out of the pennant or flag-type formation, and could now finally be setting-up for a massive rise in price. We should, however, be very watchful, due to the fact that we are at a critical area in price and time. There is a big threat of deflation, but, in my opinion, it is this very deflation (brought about by the collapse of the debt bubble) that could be driving silver prices higher.
For more of this kind of analysis on silver and gold, you are welcome to subscribe to my premium service. I have also recently completed a Long-term Silver Fractal Analysis Report.
Hubert
http://hubertmoolman.wordpress.com
hubert@hgmandassociates.co.za
“And it shall come to pass, that whosoever shall call on the name of the Lord shall be saved”
SilverSeek.com
http://www.silverseek.com/article/silver-update-5796
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
I wonder why the demand nearly tripled from 1954-1964. I realize they were using silver in coins, but that was nothing new. I wonder if it was all the post-WWII increase in money supply that finally got velocity, and required generation of a lot of currency. And that last year in 1964 they minted a prodigious amount of Kennedy halves following his death. But that 10-year spike makes it clear why they knew a shift from silver coinage was inevitable.
On a side-note, we have the same pre-velocity situation going on today. They are flooding the system with fiat, but it has no velocity because so much of it is ending up going toward a re-fill of depleted bank reserves, where it just sits. In principle, they could probably avoid off inflation if they were to stop the money printing now. But there's going to be so much political pressure to keep printing to avoid recession/depression that eventually the new money will all start to have velocity. So their choice will be recession/depression or inflation, and inflation is always easier politically.
Sorry, I wandered there...
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Re: Silver Phase Transistion
You may find it helpful to study the SILVER E.O. of 1934, the subsequent Silver act of 1946, and the attending reasons why Lyndon Baines started repealing the FUncTION of the 1946 requirement to turn over everything above 500 troy silver ounces, beginning with legislation in 1961.
Make no mistake, the original SILVER confiscation E.O. is STILL on the books and can be re-inacted at any time. Lotsa folks have heard about the gold confiscation. Silver? Not so much.
Quote:
The Silver Purchase Act of 1934, President Roosevelt issued Executive Order 6814, nationalizing the nation’s hoard of privately owned non-monetary silver, and prohibiting private ownership of quantities exceeding 500 troy ounces.
Quite an illuminating article about all of this which totally addresses/answers your question, Sparky, can be found here:
http://www.silvermonthly.com/why-did...united-states/
All has to do with intrinsic silver values, seinorage on coins, and strategic reserves--millions and millions of ounces-- which started to be liquidated via public auction, shortly thereafter. Said strategic silver reserves, including the famous "CC" silver dollar hoard found in the basement of the CC Mint which was to come along, the GAO blew out to the public by means of very public, full page ads in the WSJ and elsewhere.
beefsteak
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Re: Silver Phase Transistion
Gold Silver Ratio Breaks Below 54 to 1- Big Silver Move Just Beginning
August 28, 2012 By The Doc 8 Comments
http://www.silverdoctors.com/wp-cont...th_silver2.pngFor the first time in nearly 6 months the gold/ silver ratio has broken below 54 to 1, currently trading at 53.79 to 1.
As discussed previously, we expect the gold/silver ratio to narrow substantially during this bull run, likely as much as 20 to 1.
http://www.silverdoctors.com/wp-cont...th_silver2.png
The six month uptrend in the g/s ratio has been decidedly broken to the downside.
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Re: Silver Phase Transistion
Silver Inventory Update: Brink’s, HSBC Report Massive Silver Deposits Monday
2http://www.silverdoctors.com/silver-...ay/#more-12672
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Re: Silver Phase Transistion
There are only two metals that have been the creation of money from history and the backbone of the financial system .
They try to ignore the fact they have a back bone and of course most if of them dont;D ,so we get the mess we have today.
There is only two metals holding up this whole thing(going back ,gold and silver was money) and if it all collapses then these two metals will still be there to structure a new one(good luck on that one)around.
The economics in the world today are huge and by keeping the price of g/s down they are shooting themselves in the foot as their money becomes backed by nothing.
There is going to not be enough to go round at some stage and they may try all sorts of tricks to get it off people, but in the end there is nothing that can be compared to g/s .
They take it off you and expect you to be happy with a fist full of paper.
The government has lied to us about the inflation rate for ever and has sent everyone into the gutter because of it and their twisted agendas, you have to lie back to them with a clear conscience as it is the least a person can do,when ever you get the chance that is.
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Re: Silver Phase Transistion
Quote:
Originally Posted by
beefsteak
You may find it helpful to study the SILVER E.O. of 1934, the subsequent Silver act of 1946, and the attending reasons why Lyndon Baines started repealing the
FUncTION of the 1946 requirement to turn over everything above 500 troy silver ounces, beginning with legislation in 1961.
Make no mistake, the original SILVER confiscation E.O. is STILL on the books and can be re-inacted at any time. Lotsa folks have heard about the gold confiscation. Silver? Not so much.
Quite an illuminating article about all of this which totally addresses/answers your question,
Sparky, can be found here:
http://www.silvermonthly.com/why-did...united-states/
All has to do with intrinsic silver values, seinorage on coins, and strategic reserves--millions and millions of ounces-- which started to be liquidated via public auction, shortly thereafter. Said strategic silver reserves, including the famous "CC" silver dollar hoard found in the basement of the CC Mint which was to come along, the GAO blew out to the public by means of very public, full page ads in the WSJ and elsewhere.
beefsteak
As frightening as these laws maybe ,they are only that laws passed by some manipulator of financial markets and government,heck look at libor they are still corrupt.
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Re: Silver Phase Transistion
Quote:
Originally Posted by
Serpo
Good article - very novel analysis - lovely conclusion - silver to $50 or more next year.
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Re: Silver Phase Transistion
Recent Rally in Silver – A Sign of Strength or a Mere Correction?
Przemyslaw Radomski
| Wednesday, August 29th
In its latest Gold Demand Trends report, the World Gold Council reports that gold buying by the world's Central Banks hit a new record of 157.5 tons, more than double the level of Q2 2011 and accounting for 16% of overall global demand. Among them are the National Bank of Kazakhstan, and the central banks of the Philippines, Russia and Ukraine. If the Central Bank buying continues at the current pace this could be a record year for Central Bank buying.
That’s the good news. The bad news is the WGC estimates that global gold demand in Q2 2012 was 990.0 tons, down 7% from the demand for the yellow metal in Q2 2011. The demand in Q2 last year was exceptionally high, they point out. The main reasons for the fall are the reductions in demand for gold in both India and China over the period. In India, investment and jewelry demand has fallen mostly due to the high gold price in rupees as well as worries over a weak start to the monsoon season.
Having discussed gold briefly, let’s now turn to the technical part of our update with the analysis of silver. We will start with the long-term chart (charts courtesy by http://stockcharts.com.)
In the above chart a significant rally is seen, but it has been stopped by the medium-term resistance line and the 50-week moving average. Silver actually corrected about 38.2% of its 2012 decline (the cup portion of the inverted cup-and-handle pattern). This pattern is still in place.
Silver has shown to often be volatile and a sharp, quick move to the upside can be quickly followed by a period of disappointment. Such was the case nearly a year ago in the final months of 2011 and at the end of February 2012. Silver’s price also moved very close to the 50-week moving average back then as well.
The point is that despite silver’s recent strength and multiple reasons due to which it’s likely to soar in the following years, it remains in a medium-term downtrend. It will remain the case until a breakout is seen.
Let’s now switch perspective to the non-USD one, to further investigate the current situation in the white metal in a different way.
In the chart of silver from the non-USD perspective, prices are right at a resistance line and the RSI level suggests a medium-term overbought situation. The implications are therefore similar to what we discussed above – the medium-term case for silver may become bullish, but so far it hasn’t.
Summing up, a lot has happened in the past several days in the white metal market but not very much has really changed from the medium-term perspective. So silver’s show of strength seen in the above charts is not really a very bullish phenomenon. This is especially true when the overbought RSI levels are considered.
Thank you for reading. Have a great and profitable week!
P. Radomski
Editor
www.SunshineProfits.com
http://www.silverseek.com/article/re...orrection-5956
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Re: Silver Phase Transistion
http://traderdannorcini.blogspot.com...downtrend.html
Trader Dan's Market Views
Friday, August 31, 2012
Silver Breaks its Downtrend
For nearly the last year and a half, silver has been in a sustained downtrend in price although it has managed to find a floor of support near the $26 level. This week it has finally broken that downtrend. If this metal is going to begin a sustained rally, any setback in price should find buying emerge near the downsloping blue line shown on the chart. Failure to hold this level and particularly now the $30 level, will see the metal fall back into that triangle formation with support then coming in down closer to $28.
Note that the metal is now trading above the 50 week moving average while both shorter term moving averages are now moving higher. The trend is up.
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Re: Silver Phase Transistion
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Re: Silver Phase Transistion
Harvey Organ: Cartel Manipulation of Gold & Silver is the Ultimate Treason, As US Wealth Flows East
December 27, 2012 By The Doc 29 Comments
http://www.silverdoctors.com/wp-cont...er-treason.pngThe Doc sat down with Harvey Organ Wednesday for the first of several interviews regarding the recent massive cartel intervention in the gold and silver markets post the QE4 announcement, the fiscal cliff, the CFTC’s silver probe, and the unprecedented 20 million oz of silver still standing for December delivery.
Harvey stated that the end game is being played out, and that an Asian group has decided to take on the cartel and drain the physical silver from the COMEX. He states that the bullion banking cartel’s suppression of the gold and silver markets is the ultimate treason against Americans, as 350 years of US wealth is being drained East due to the price suppression of gold and silver.
MUST READ!
http://sdbullion.com/wp-content/uplo...lver-Eagle.png
The Doc asked Harvey his thoughts on the extraordinary developments in the December delivery month for silver, which has seen the amount of longs standing for delivery actually increase as the month progressed:
That has never happened before! I’ve been watching this- on an active month, usually what happens is the deliveries are the highest in the first 3-4 days in the month, then they go down a bit as there’s usually a few cash settlements.
What happened in December, on December 6th you saw the low point of 12.6 million ounces. All of a sudden it turned around and you saw 13, 14, and now 19.5 million ounces of silver standing for delivery. What really bothers me (and I have been unsuccessfully trying to get an answer from the CFTC) is that every single deposit, withdrawal, and adjustment in the CNT vault is done at three decimals at .000.
The COMEX is a physical market! It’s strictly physical! You should see oddball numbers! I could understand one or two bars adding up to .000, but when I start seeing everything, I start getting suspicious! I have a strange feeling that they’re settling in paper. The owners don’t know it, they think they’re getting the real thing.
What’s actually happened is that there has been a large increase in the number of investors wishing to get their silver out of a registered COMEX vault. They’re asking for silver, but they’re asking that it’s not stored in a COMEX vault, specifically HSBC or JP Morgan. That’s what I’m seeing in silver.
The other thing you should be very mindful of, the open interest on gold has declined, it’s kind of low, and it kind of tells you that many players no longer want to play the rigged game. But it’s not so in silver! OI has remained relatively high at 140,000 or higher constantly the past 2-3 months regardless of price! Certain people have decided to take these guys on, they know exactly what they can take out of the COMEX, and that is exactly what’s going on at the silver front.
The Doc asked Harvey about the US Mint’s 3 week suspension of Silver Eagle sales and whether it indicates a shortage of silver at the mint:
That is a real indication of shortage. If you’ve had a look at the Canadian Maples sales totals. They started in 1985 with 200,000 ounces, and this year they sold 20 million ounces in Canada? My goodness! This means a lot of the Canadian silver is being exported out. The Mint’s making money. So the demand is there, obviously the US Mint just doesn’t have the silver to make them. You can just see it in the demand! The US produces about 40 million ounces of silver. This means that in order for the US to meet demand in all forms they need to acquire silver from Mexico, etc, and then you have the jewelry demand, the medical and pharmaceutical demand, the solar demand. Only 100 million ounces of the total silver supply goes for investment. 900 million ounces goes towards industrial/ medical demand. There are new uses for silver every day!
What these banks have done is they are eliminating the supply of silver. I really think that the ultimate treason is that our gold and silver are leaving our shores and heading East. Eventually we won’t have it- just like rare earths- we won’t have any! That’s simply treason!
Check back tomorrow for part 2 of The Doc’s interview with Harvey Organ, in which Harvey discusses the reason the CFTC has not and cannot release the findings of their 4-year silver probe, Harvey’s view that the manipulation is in the end game and will collapse in 2013, and how the daily CME reports inadvertently reveal a massive shortage of physical silver among the bullion banks.
Check out these similar articles:
- Harvey Organ: The Moment London is Out of Silver, the COMEX Will Be Out in a Nano-Second!
- Harvey Organ: Gold Rehypothecation- COMEX, the LBMA, GLD, the Bank of England- IT’S ONE INVENTORY!
- Harvey Organ: JPM Unwinding IRSwaps, Losses ‘COULD BRING DOWN THE WHOLE FINANCIAL SYSTEM’
- December Gold Delivery in Jeopardy? CME Declares Force Majeure at Manhattan Gold Depository
- Royal Canadian Mint Gold ETR IPO Raises Over $600 Million in First 3 Weeks
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