Craig Hemke is On Guard Against the Banks taking an in-depth look at the charts for possible areas of market manipulation and precious metals price suppression of COMEX digital gold and digital silver…
Watch these dates for “fear” to strike again…
We may have just seen the worst with two very simple but telling indicators
Short-term problems surface with the GLD
Which we home nobody here has set…
Jack fishes out all the details…
Pit stop SITREP coming off a brutal week for the miners
But it’s probably nothing…
And the third quarter has only just begun!
Maund: “Precious Metals Stocks Alert”
Technical analysts assume past prices are a valid basis for predicting what investors will pay tomorrow.
The Warren Buffetts of this world act differently: they care not what others think and use their own judgement of value. This means that value investors often buy when the trend is down and sell when the trend is up, the opposite of technically-driven decisions. A bear market ends when value investors overcome the trend.
Technical analysis is a tool for idle investors unwilling or unable to understand true value. It dominates price formation in western markets and distorts investor behavior by exaggerating any natural bias towards trends. It is this band-wagon effect that is the root of trend-following’s success, but also its ultimate weakness.
A better strategy is to make the effort to value gold properly and then act accordingly.
Technical analysis will always have a place in the speculative marketplace. Its function may not be reading tea leaves, but its connection to fundamentals is about as useful as the modern day consumer price index.
That limitation, combined with the allure of speculation, makes technical analysis a tool for exploitation by those who have the ability to “paint the tape”.
Submitted by Morris Hubbartt:
At this point, quantitative easing is pumping about 85 billion electronically printed dollars a month, into bonds and other “quality assets”. Without the artificially low interest rates that QE creates, the economy would probably implode. I view the current market as a dangerous place to allocate investment capital. I targeted 13,500 initially, for the Dow. Now I’ve added a 2nd target, which is 12,200.
Down-day volume is beginning to overwhelm up-day volume, which is extremely bearish. The Dow could soon form a huge double top pattern, just as the infamous “Sell in May, and go away!” period of time arrives!
Overall, the stock market continues to be a huge beneficiary of QE policy. How long can this stock market rally continue? To help answer that key question in more detail, I am focused on two leading indicators.