SD Outlook: It’s time to see just how strong gold & silver really are right now…
I’m not calling this “the most important week for gold & silver in 2019”.
We’ve already had that week.
It was the week after gold broke-out of the multi-year resistance.
Gold & silver came out on top that week.
This week, however, we get to see just how strong gold & silver really are.
From Wednesday through Friday, gold & silver will face cartel pressure:
On Wednesday, the Fed concludes its 2-day FOMC Meeting, with the ritualistic releasing of the statement and consequent decision on interest rates at 2:00 p.m. EST.
Recall that now, since every Fed meeting is a live meeting, there is a press conference following Fed Head Jerome Powell’s remarks – usually starting at 2:30 p.m. EST.
How do I see gold & silver performing over the next two days and during the FOMC?
I expect gold & silver to remain range-bound, with gold between $1425 & 1450, and silver to remain range bound between $16.15 – $16.65.
Well, it looks like the probability of a rate cut of 25 basis points is nearly 80%:
The probability has been roughly 80% ever since the Fed walked back all of the uber-dovishness of late, so it seems like a 25 basis point cut is baked into the cake.
Could we see a mini pop in gold & silver prices going into the meeting?
Well, only if circumstances changed a lot between now and then, on the geo-political front, or the Trump vs. Fed front, or the “weak dollar” front, as in a “black swan” of some sort, or if somehow the expectations of a 50 basis point cut go up substantially.
I’m not expecting the latter.
Regardless, the natural outlook for both gold & silver is bullish, despite the COMEX positioning, open interest and short positions.
We’re not out of the clear after the FOMC, however.
On Friday we get the BLS Employment Situation Report for July, 2019.
Recall that last month the government says the economy created 224,000 jobs for the headline number.
Generally speaking, the cartel uses the jobs report at their cover to smash gold & silver prices.
But what if the cartel is in fact losing control of the gold & silver markets?
I think that after this week, we will be very close to knowing the answer to that question.
I think the cartel is losing control, and if they are, and price starts moving higher, especially for silver, then we will know we are not far off from a big move into physical gold & physical silver.
Both the “fear trade” and the “fear of missing out” will be kicking in.
So this week?
It’s a test of might.
It’s time to see just how strong gold & silver really are.
The gold-to-silver ratio is in the mid-80s to start the week:
If silver keeps playing catch-up to gold, then I’d be looking for low-80s coming up pretty soon, but if we see that gold & silver are stronger right now than most are thinking, then it is very likely that we see the ratio move sideways this week on moves higher in price for both metals.
If charts matter, I’d like to see silver at a starting point of $16.25 going into Wednesday afternoon:
There is some minor, short-term support there, and I think a move to $16.25 would put silver in a great position as the charts would show that silver had a nice, bullish pullback.
Gold is beginning the week gaping higher:
I’m really not looking for much movement in gold until Wednesday.
Likewise, I’d like to see palladium bounce of of $1500 again:
If we bounce here and run to $1600, palladium’s daily chart is going to look all sorts of bullish, however, if $1500 doesn’t hold, then we will have put in a lower-high and a lower-low.
If gold & silver prove to be stronger than most think, then platinum could close out the week well above $900:
Furthermore, the 50-day moving average is about to start moving higher in a hurry, and we’re not that far off from a golden cross.
We might see a short-term triple-bottom at $2.60 in copper this week:
I’m currently not expecting much more downside than a short-term triple-bottom, and I’m saying that because of the fundamentals.
Fundamentals are really about to matter.
If copper puts-in a short-term triple-bottom, I’d be looking for a short-term double-bottom in crude oil:
Also like copper, I’m not expecting much more downside to crude oil, in part because I think the Deep State Globalists’ plan is to bring max pain to America, so I do see crude oil prices going up very soon, and I also say I see oil prices rising because if the dollar starts moving lower, which I think it will, then I’d be looking for crude oil to move higher.
I’m thinking we could have a short-term melt-up of the US Dollar Index into Wednesday:
If we do get that melt-up, along with a “sell the (rate cut) news” move lower, then to add some momentum to the downside I think a low print on Friday in the Jobs Report is highly likely, you know, to show the US economy is weak and not necessarily the place to be.
It’s not, but right now the mainstream is sufficiently fooled at best or playing along at worst.
It will be interesting to watch yield on the 10-Year Note this week:
Several dynamics affecting yields need to be considered this week, one of which includes the degree of the rate cut on Wednesday, and it is noteworthy right now that a 50 basis point cut would take care of the inversion, assuming we maintain above 2.0% on the 10-Year.
I’m looking for a possible 11-handle on the VIX going into Wednesday:
The VIX is one of the easiest things to manipulate, so a lower VIX makes for a nice optical illusion on Wednesday when Powell the Magnificent takes the stage.
If the DOW reaches a record high, it’s quite possible that Powell has a stock market trifecta going into his presser:
And if the rate cut is deep enough, it’s possible we see a melt-up blow-off top in the Dow too.
What’s the bottom line as we find ourselves here on this beautiful Monday in late July?
Gold & silver will be put to the test this week by the Fed and the US government.
The cartel always prefers to suppress gold & silver prices to the downside.
This week provides two of the ultimate covers for metal smashin’ fun.
So, if gold & silver prices actually end up rallying on the week?
We will have further proof that the cartel is losing control.
They’ll lose control, and this may be the week they do.
Because we are in high summer vacation season.
So it would be the perfect time to lose control.
Because the people will be distracted.
The MSM will focus on the Fed.
Others on the booming jobs.
Gold and silver just might.
In this Test of Might.
Impress this week.
Win this fight.
– 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.