RETURN TO SEATS, FASTEN SEATBELTS: All Markets Turbulent Including Gold & Silver

SD Outlook: This flight is turning out to be a rough one, and we’ll know soon enough if we need to assume crash positions and brace for impact…

I’m going to keep it short on words today, but there will be no shortness of action in the markets.

Everybody is in for a rough ride.

That’s just the way it is.

For those who don’t know, Brett Kavanaugh was sworn in as Supreme Court Justice over the weekend. Thank God we’re getting closer to the time when all the mass arresters, military tribunalists, and martial lawers will either have to put up, or, well, you know.

On to the markets.

I have no specific calls this week, but I will say that things could get very dicey.

China is back in action this week, and we see the Yuan is falling against the dollar:

On the chart, the line goes up, but what it is showing is a weakening yuan against the dollar, meaning each dollar yields approximately 6.92 yuan. For those who follow the whole “China controls the gold price” aspect of the market manipulation, this is bearish for the price of gold (and by extension the price of silver).

Overnight and again in the pre-market this morning we can see the pressure being applied to gold and silver:

I still think there is more downside in gold than in silver at this point, however.

We see the set-up to reject gold at the all important 50-day moving average:

Looks like the intent is to have gold rejected at the 50-day, and then beat it to smithereens to take out the $1167.

We’ll see.

Of course, silver is under pressure as well:

I feel more confident that silver’s downside is more limited when compared to gold, percentage wise.

I don’t really have any calls to make on gold or silver this week. It is really going to be one of those sitting on the sidelines and playing the game of wait-n-see. Now, if silver breaks a 14-handle, I’ll pull the trigger on an ounce or two, but other than that, I’m in spectator mode right now.

It still is a great time to be a buyer here, and new stackers have been given an absolute gift, so if there is difficulty in making the decision, we can look to the gold to silver ratio for clues:

The ratio is still clearly favoring silver at this point.

Palladium had some indecision throughout the night:

The pullback still looks healthy, however. Right now, palladium is the only bright spot in the precious metals.

Platinum looks like it is set to put in its fourth down-day in a row:

I’m not so sure the 50-day in platinum will hold the next time.

Crude oil is some $3.50 off its recent highs:

Of course, crude oil has been trading erratically most of the year, with several strong rallies followed by drops and fades.

Copper seems to be wondering if it will have some support at the 50-day:

On Friday I said it looked like either copper was consolidating at $2.80 or if copper was ready to come down to the moving average. It looks like copper has chosen the latter.

Of course, with total turmoil around the globe, the dollar has seen renewed strength overnight:

While we will surely hear the “flight to safety” from the status quo pushers. That said, if the DXY looks like it is surging to 97, we might get some jawboning from President Trump, either directly by talking about the dollar itself, or indirectly by talking about all the “currency manipulators” out there.

Of course, here’s where all eyes will be:

Wondering if the bond market is going to keep on crashin’?

All eyes will also be on the Farce:

They will be looking for a surge in volatility.

And all eyes will also surely be on the stock market:

The bottom could really fall out of the stock market this week. Especially if the bond market is truly crashing.

I don’t agree with President Trump’s assertion that the US is this awesome stand-out among a globe in chaos. Therefore, I think the US stock indices will catch down to the rest of the world, not the other way around, and as the rest of the world keeps falling, well, the US markets are going to have to fall even farther.

Bottom line: Don’t look for gold & silver to steal the show this week. This week will be all about the dollar, the bond market and the stock market. Of  course, if gold & silver put in lower-lows, we will surely be hearing about that, but if anything, be tactical about it and strike if willing and able when the opportunity comes up. That said, it is going to be a rough ride this week.

Assume crash positions and brace for impact?

We’ll know soon enough.

Stack accordingly…

– Half Dollar


About the Author

U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.

Paul’s free book Gold & Silver 2.0: Tales from the Crypto can be found in the usual places like Amazon, Apple iBooks & Google Play, or online at Paul’s Twitter is @Paul_Eberhart.