gold bullWhile we are very over bought short term, gold and silver are moving off of EXTREME OVERSOLD levels not seen in the last 18 years and possibly EVER! Let me explain this because it is more important to gold bulls than anything over these last 18 years.



Submitted by Bill Holter, JSMineset:

Over the last three weeks, U.S. equity markets have recovered and are now more overbought than any time since 2009. While this is the case with equities, it is not the case with high yield debt. As I have said many times before, credit analysts actually look under the hood to discern the real situation and credit at this point is not buying the equity bounce/short squeeze. In fact, high yield credit spreads are rivalling the dark days of 2008.

The other area of interest since January is gold and silver. Gold and to a lesser extent silver are quite overbought short term. Many analysts in the “alternative” space have been recently cautioning that gold and the mining shares are about to be monkey hammered. Other than being overbought, we also have COT numbers showing the commercials very net short and the same setup as prior to previous waterfall events. So where do we go from here?

While we are very over bought short term, gold and silver are moving off of EXTREME OVERSOLD levels not seen in the last 18 years and possibly EVER! Let me explain this because it is more important to gold bulls than anything over these last 18 years. Looking at the chart below you will notice a “hook” at the very bottom right. This hook is occurring from the lowest levels for the MACD (moving average convergence divergence).

The “hook” or crossover is coming at a time where gold and silver have been continually beaten down with paper contract for over four years. The apologists can argue all they want to but it is fact that physical demand has been strong and gotten stronger while supply has peaked and begun to shrink (particularly in silver). The “supply” over these years has been of the paper variety and hasn’t been real metal by any stretch. In fact, it is the nature of this naked shorting and selling that will lead to something far different than just a garden variety rise in the metals! Paper exchanges will become irrelevant shortly as physical exchanges are opening up and none as important as the one opening in China next month.

courtesy David P/KWNews

I wanted to show this chart because this is truly a “danger zone” for the bulls. As I mentioned above, many long-time bulls are now cautioning of another “whack a mole” scenario. This very well may be true but not something you should bet on. You see, something has definitely changed in not only the precious metals markets but ALL markets. You must ask the question “are they losing control”? I believe the answer is yes they “are” but have not “yet”. It is the “yet” part that poses the risk.

Over the last four plus years I have said I thought it was a poor idea to try to time entry into gold and silver. Other than just a few months’ time, gold traded under $1,300. Now, in just over one month’s time, gold has nearly regained the $1,300 level. This means that anyone who purchased over the last four years (after the June massacre) is at least break even or has a gain. Did anyone’s “crystal ball” send out an alarm telling you NOW is the time to get back in? Harry Dent still advertises $700 (or possibly $250) gold. The danger now is to listen to those telling you we will have a pullback. This “danger” may very well have you waking up on a Monday morning and no way to reinstate a position you took a profit on.

Jim has said the upcoming (already here) rally will be the one you never sell. To clarify, he is saying this is the rally you never sell UNTIL some sort of new currency is introduced that has something tangible behind it and can be “trusted”. No market will go straight up or straight down, however for gold, we are in a situation where mathematically not enough gold has been produced or exists to cover the paper contracts sold to put price where it is now. The “danger” for bulls is to try to trade this up move only to find out the FRAUD of naked sales and empty vaults is discovered …and it will, only a matter of time. You are either in …or you will be out!

Please, stare at the above chart. Print it out and put it on your wall! It tells you where we are in the big picture. We are massively oversold long term and on a launch platform 4-5 times higher than we were in 2001! In my opinion we will look back at this chart only to see the bear market caused by “dilution” with naked contracts was only an overdone (and very much FORCED) correction in huge overall bull market.

I believe the big danger now is the mathematical fact that too much debt pervades the entire global financial system …and the entire system comes down. Please ask yourself this question, what will be left after a credit meltdown? JP Morgan answered this question before Congress in 1907 when he testified “Gold is money, everything else is credit”!

Standing watch,

Bill Holter
Holter-Sinclair collaboration
Comments welcome [email protected]

Buy Silver Coins and rounds at SD Bullion

  1. The danger now is to listen to those telling you we will have a pullback. This “danger” may very well have you waking up on a Monday morning and no way to reinstate a position you took a profit on.


    Exactly 100% correct, spot on, way to go… could not agree more.


    After reading douche after douche come up with these “OMG we are overbought at $15 silver” and “You must short the miners if you are bullish on them” type of garbage come out from all corners of the supposed bulls (Ballanger, Gold Core, etc, etc) tells you this is exactly the playbook they are going for.


    If they make gold go in a straight line up, it will cause probably 90% of people to sell along the way, well before even $1400… especially if you get all the talking heads to come out and use the “boogeyman” of previous cartel attacks (they can’t), or the “boogeyman” of technical overbought conditions that are irrelevant on a 30 year chart, or the “boogeyman” of cramer / gartman being long as well, or WHATEVER. they are all now trying to get you to take profit after 5% or 10% when you have been waiting for this moment for YEARS.


    DO NOT TAKE PROFIT NOW. you will literally be throwing away an opportunity you have waited years for. NOBODY is long gold and silver right now… we aren’t even out of the first inning yet. Seeing the moves of Jan – Feb are not “THE MOVES”, they are merely a very tiny indication of what is about to happen. Does any serf on the street own gold yet? Did the government stop borrowing money and pay off the national debt? Did silver revert to its previous high?


    No my friends… do not be fooled in to selling early. WE EARNED THIS AND WE SHALL RIDE IT OUT FOR MAXIMUM UPSIDE.

    • @SeanKelly

      I think you are spot on.  I think the most difficult question for many of us who have accumulated precious metals is when to sell if at all.  The answer to this question is contained in the article by Bill Holter above.  For me, Bill Holter is one of the (few) truth tellers and therefore a hero.  He may not always be correct but he has the integrity and the knowledge to call the shot.  Let’s hope he is our Babe Ruth.

    • Have the Canadians lost their flipping minds?  Whoever is behind this moronic move belongs in the Pantheon of All Time Morons which should include the Englishman (Dennis Brown?) who sold their gold into market lows.  Complete dunderheads.

    • Maybe they were worried about a neighbor coming to steal it!

      Maybe it is a false flag to cover up their tragic boating accident…95,895 ozs is a lot of weight to place in a boat! 😉

    • absolute rubbish, and in fact the manipulators lose money by manipulating. every time they sell like $5 billion dollars into the market in 1 second, they are killing their own bid stack and getting horrible prices. so it is largely those on the other side of the trade that are making money off of their desire to throw away money to “send a message”.


      btw, i’m up huge in CDE, HL, AUY, IAG, AXU…

      HL still has a very abnormally large short interest, so if you’d like the chance to profit at the expense of a manipulator, just buy some HL. any day now the shorts are going to puke up the position and have a major buy-in. 33 million shares.


      ascribing magical god-like powers to the manipulators is QUITE foolish.

    • think about it… if you bought gold at $250 / oz in 2001, you made lots of money.


      if you SOLD gold for $250 / oz in 2001, you might be a manipulator named “Bank of England” / “Gordon Brown”… and just how much money did they make? Right, they torched their national treasure for pennies on the dollar. Hardly a “money maker” even though they “knew ahead of time”.


      Other manipulators include Bear Sterns… remember they went to the morgue on the day silver broke above $20 for the first time since the 1980s. That move stone cold killed them dead in their tracks. Major manipulators, major losers.




  2. Never sell

    Never give in


    I think it was a fleet of canoes up on Great Slave lake, eh?… That was the first round of “losses”…. Now, the punk kid comes along and tries to repeat the event…with his fleet of “rubber boats” in his bathtub….. What a sad day in Saskatoon, eh?

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