gold sentimentThis week, I spoke to an elderly fellow who has accumulated silver for decades. He has been buying it since the 1960s, and he’s not concerned about the current price action at all. 
Commercial traders are bullish, and the public is more negative than at any time in recent history, including the 2008-2009 lows.
The public may be correct, but only in the short term.  Their long term track record is disastrous, so this is probably a very good time to accumulate physical metals.

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Submitted by Morris Hubbartt:

TLT (T-Bond Proxy ETF) Major Top Chart

 

MH1

 

  • The US bond market has become a poor vehicle for long term investment. Rates are low, and most small investors cannot afford to buy a T-Bond that costs $135,000.

 

  • Even if they could afford it, QE tapering could cause large capital losses on their investment.

 

  • From a technical perspective, TLT looks quite bearish.  The head and shoulders top breakdown on this weekly chart is predicting lower prices. On a shorter term basis, a bounce back to the neckline is what I’m anticipating.

 

  • My recommendation is to avoid the bond market, or short it.

 

Dow Trouble Time Chart

MH2

 

  • Several weeks ago, the US stock market gave a huge warning, with an outside reversal day.  I’ve highlighted that on this chart, and called it a “shadow of death”.

 

  • To date, that shadow of death day has marked the high for the Dow.

 

  • Volume is now generally soft on up days, which is bearish.

 

  • From a sentiment standpoint, very few bulls have thrown in the towel, and that’s also bearish.

 

  • I see the Dow falling to 13,800 or lower.

 

FXI (China Stock Market Proxy ETF) Chart

 

MH3

 

  • The Chinese stock market has been the leader to the downside, and for good reasons. The Chinese economy is the engine of world growth, because it is the world’s largest manufacturing nation.

 

  • Like the US bond market, the Chinese stock market also has a large head & shoulders top pattern in play.

 

  • There is heavy distribution volume, although this market is oversold and probably due for a small move higher.

 

  • My FXI target is $26.

Gold Public Opinion Chart

 

MH4

 

  • Commercial traders are bullish, and the public is more negative than at any time in recent history, including the 2008-2009 lows.

 

  • The public may be correct, but only in the short term.  Their long term track record is disastrous, so this is probably a very good time to accumulate physical metals.

 

Gold Support Zone Chart

 

MH5

 

  • Several weeks ago I said I was looking for a move to either $1580 or $1260.

 

  • The bearish target has been acquired (unfortunately).

 

  • Gold is now trading in the large $1155 – $1227 support zone.  I’m forecasting a bounce to $1321, followed by a pullback to around $1200.

 

  • From there, there should be a stronger rally, to about $1432.

 

GDX Price Destruction Chart

 

MH6

 

  • Compared to the gold price, gold stocks are cheaper now than they were in the bottom of the 2008 lows.

 

  • Buying this type of gold stocks “destruction” makes sense, but investors have to be prepared for even lower prices!

 

Silver Public Opinion Chart

 

MH7

 

  • This chart shows that the public is running for the exit door, in the silver market.

 

Silver Buy Zone #3 Chart

 

MH8

 

  •  This week, I spoke to an elderly fellow who has accumulated silver for decades. He has been buying it since the 1960s, and he’s not concerned about the current price action at all.

 

  •  In less than a year, silver has fallen almost 50% from the highs in the $35.44 area. Silver investors should be more patient than gold investors, because of these volatile price swings. 

 

  •  Note the green parabolic downtrend line on this chart.  The price has crashed through strong support at $21.44 and $19.55.  I think the support at $16.25 (highlighted with green circles) is strong enough to break that parabolic line, and get a decent rally started!

 

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    • About the only person that has correctly called this market in the past year is Precious Metal Pete.  He called for the paper price to fall dramatically a year ago.  Jolly Up! 
       
      Now he’s revaluing his gold to its true worth.  We must assume this means something big is on the horizon and move up in prices.
       
      When all the media says sell, sell and run to the hills.  It really means to buy with both hands and plan to have a tidy nest egg.
       
      Sinclair was mostly correct just bad timing?

    • @PowerBall:
      So where do we read PMP? 
      I have seen much that made sense, but read so much (or did) 
      that it all merges into a conglomeration of mish-mash jam in my
      brain… it’s a constant swirl of info and sifting, that works well 
      in the overview, but as for giving credit and blame, well, that
      gets a bit fuzzy as to who gets what LOL! 

    • @Ed_B
      lol. I WISH! 
      My stack might fit in a briefcase like that…
      but it’s not all one type  ;) 
      I’d like that IN ADDITION to my current stack! 
      Here are a few of my “odd pieces” and a nice MS69 I got FOR SPOT, 
      when Silver was $35 LOL! 
       

    • “lol. I WISH!”
       
      Heh heh… yeah, we ALL wish for something like that.  Whatta stash!
       
      “I’d like that IN ADDITION to my current stack!”
       
      Right.  Who wouldn’t?  Imagine the fun that could be had by stacking them into buildings, forts, etc.  Make a little tiny one out of wooden blocks for the Fed and a really BIG one of silver bars for… OUR version of Ft. Knox.  lol
       
      Those are some very nice pieces.  Even at $35, getting that MS-69 ASE at spot is still quite a bargain.  :-)
       

  1. There is a bear market in the paper price of silver and a bull market in the physical silver market. The emancipation of phyzzz will come, thats when the price will break new highs, demand is increasing almost daily, buckle up the launch is’nt to far away! Thats not to say we havent hit the bottom yet, so prices may go lower first, but when the run comes, look out! It’s like building a huge bon fire and waiting for someone to come along with a match. When it goes it will be huge!

  2. The whole idea of the MMM (mass misinformation media) is to convinced the dolts not to buy PM to protect their net worth from what is coming. The scum can make a huge amount of money from a volatile ride up and then back down again. I believe it is coming soon. And don’t be surprised if a devaluation occurs when the new $100 bills are released.

  3. Silver is silver and gold is gold,
    And neither will ever get old.
    So, be not fearful but do be bold,
    And buy those PMs to have and to hold.
    Blessed be the faithful, stack and be well.
    For we are the guardians of real money, 
    And the banksters will end up in Hell.  :-D
     
    Happy July, Everyone!  :-)
     

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