SD Friday Wrap: Gold & silver are duds again as the stock market bombing campaign has only just begun. Here’s why it’s about to get much worse…
I have argued my theory before, and it is about to be put to the test.
I think my theory will be put to the test next week, and hey, at least it’s not one of those theories in which we have to wait months or years to see if the theory will be proven true.
OK, “Hey Half Dollar, what theory are you talkin’ about?”.
I’m talkin’ about the plan to crash the stock market and place the blame on President Trump.
Let me explain.
Here’s what the Globalists/Deep State haven’t been able to get President Trump with (in no particular order):
- Russiagate/Russian collusion
- Mentally incompetent
- Sexual harassment
- Immigration/family separation
- Shady tax filings
I’m sure there are other strategies for ousting the President that I’m leaving out, but that’s not the point. The point is if the Deep Staters can’t get President Trump, and then either throw him out of office, render him ineffective, or at least get his supporters to jump ship, the Deep State will bring the markets down and blame the President for the crash.
That looks exactly like what they are doing if you ask me.
And then some.
When I say, “and then some”, what I mean is we have this brand new Migrant Caravan 2.0, and apparently there is a Migrant Caravan 3.0 right behind it, we have pipe bombs and suspicious powders being mailed all over the US, and yet, nothing is working to wreck Donald Trump’s Presidency.
Everything the Deep State has tried has failed, so it certainly looks like the plan is to crash the markets going into the mid-term elections.
Call it the Deep State’s Hail Mary. They would rather not have to use their Hail Mary, because likely it will bring some self-inflicted pain to their own bank accounts in one way or another, but the Deep State is really left with no other option.
Here’s how I envision the line of thinking by the Deep State (their thoughts, not mine):
If we can’t get a blue wave, and if we can’t steal enough of the mid-term elections to win back the congress, and if we can’t even hardly get immigrants, minorities, democratic socialists, women, the disenfranchised, and all of the other mis-guided support base of the delusional left, to go out and vote, then if we can just crash the stock market hard enough and painful enough, the left may get motivated to go out and vote, Trump’s supporters may not go out to vote, or, in our best-case scenario, the left goes out to vote and Trump’s base goes out to vote, but Trump’s base votes democrat, just to spite the President.
Now, we are still a week and a half away from the mid-term elections. The elections aren’t until Tuesday, November 6th.
So what does all of this mean? This case I’m laying out? This, dare I call it, conspiracy?
It all means that if I am right, and if the Deep State is conspiring like I think they are, then next week the stock market is going to crash.
Which means this week was just a warm up. A taste of things to come. A primer. Folks, if I’m right about this, then we haven’t even seen the “shock-n-awe” bombing of the stock market yet.
We shall see.
For now, assuming I am correct, it seems as if the Deep State is trying to get the timing of the stock market crash just right. The bottom was falling out of the stock market every single day this week, in continuation of the bear trend from prior weeks, yet there have still been three distinct “saves” of the stock market this week.
Trying to get their timing just right:
You know, just so there can be maximum effect next week when there is no saving the stock market.
So let’s explore that further, and look at what might provide support for this Deep State mission.
Right now, the consensus is that the mainstream media is out there talking about how there is nothing wrong with the stock market, and how this is a good dip-buying opportunity.
Here’s a common example of the consensus:
Turned on CNBC’s Fast Monkey show at noon(which I never do). Wanted to see if there was any fear. My take after 10 minutes: (all I could stand). Almost none. Market’s “cheap.” “buying opportunity.” Token bear (Mark Yusko – very thoughtful guy) was constantly interrupted &attacked
— fred hickey (@htsfhickey) October 26, 2018
Now, if I am right, and there is a conspiracy to crash the stock market ahead of the mid-term elections, look for the MSM to change its tune next week, and also be on the lookout for a change in the consensus’ interpretation of said changing of tune by the MSM.
The wild card?
That’s right! Gold (and silver) is the wild card. I think the Deep State, which obviously has influence on the cartel, has the incentive to let gold & silver rally next week. A rally in gold & silver would be a type of “no confidence” vote in the President.
Why do I think this is the case?
It has to do with also the dollar. We know President Trump has flip-flopped on the dollar several times this year, but the last things he said about the dollar (in terms of the strong dollar vs weak dollar meme), was “money is pouring into our cherished dollar” and, rather frankly, boasting about “our very strong dollar!“. A rally in the gold & silver price, in conjunction with a crashing stock market, will be a vote of no confidence of the President, and taking it one step further to incorporate the dollar, who is to say the Deep State doesn’t flood the market with dollars to drop the value of the dollar next week, which would further support the Deep State’s mission of discrediting the President via a crashing stock market, accompanied by a mainstream media that has changed its tune, accompanied by a rising gold (and silver) price, and accompanied by a falling dollar?
In summary, here’s what to look for next week if this theory of mine is correct:
- A stock market crash
- A MSM changing its tune from perma-bull to angry bear
- A rally in gold & silver
- A falling dollar
This is supposed to be a recap, however, and not a forecast, so let’s dive into the charts and see what went down this week.
Whether I’m right or not about the Deep State plan, this doesn’t look good:
That’s not a daily chart either. That’s a weekly chart of the stock market, where each candle represents an entire week of trading. Notice the Dow is below the support of the major moving average of the 50-week moving average. I repeat, that is a fifty week moving average. That’s a big deal, and that is one big, fat, bearish signal. Also notice the Dow is now down for four out of the last five weeks.
I still think the fear barometer has more spike in it:
Especially if I’m right on my “crash the markets to make Trump look bad and hope his base votes democrat in spite” call.
Again, regardless if I’m right on my theory, here’s another potentially ominous sign:
Of course, it is only ominous if you are a dollar bull.
Is that a double top on the DXY?
I have said that the yield on the 10-Year Note could be headed lower:
Which is exactly what we saw.
This is because as investors look to flee a falling stock market by making a move into “safety”, the increased demand for bonds pushes up bond prices, which pushes down interest rates. That said, ultimately the debt of the US is no good, and the debt will either get defaulted on, or hyper-inflated away, but for now, investors are behaving as if these markets are normal. Investors literally think the flight to safety is made by moving into the paper US bond market. That “flight to safety” has been the normal course of action for many decades now, but when you think about it, what has been normal is normal no longer.
This is especially true since the 2008 global financial crisis.
I am not quite concerned about crude oil just yet:
I still think crude oil is more likely to finish the year at $80 than at $50.
OK, “Hey Half Dollar, everybody knows the price of crude oil crashed when the stock market crashed in 2008!”.
However, notice what happened to crude oil in the middle of 2014.
The price of crude oil crashed again, and the stock market just kept going, and going, and going. I’m not saying crude oil is going to spike back up to $140 a barrel any time soon, but I do think the likely scenario is that the stock market catches (as in crashes) down to crude oil, while crude oil either stays the same, or increases slightly from here (like to my $80 a barrel year end price target).
Copper, on the other hand, is becoming concerning a little concerning here:
That is one serious fade coming off of the most recent lows.
Platinum is basically trading within a $20 range:
Call it a range between $820 to $840.
Recall that just this week, palladium fresh, new all-time highs:
This should not be surprising to anybody, however, as there are some serious supply concerns.
Palladium has cooled since hitting the all-time high, but that would be expected. Palladium has been on fire for months, which has included three impressive surges higher in price.
The gold to silver ratio really looks to be peaking with tightening daily swings:
Could we see a double top in the GSR above 85.75?
We could, but there is room to think we may not get that high in the ratio.
Here’s the thing, and it is fundamental in nature: Gold rallies first, and silver then follows gold, as will be shown on the daily charts below.
To continue my point about which metal moves first, the turn (rally?) is best seen, not by looking at the price, but by looking at gold’s 50-day:
We are clearly pointing north now.
Whereas silver has yet to make the turn on its 50-day:
We know the turn is coming, and as such, it will be reflected in a falling gold to silver ratio once silver starts playing catch-up to gold.
Many analysts, experts, investors, pundits and traders think gold and silver are still going to make trips down to revisit those December, 2015 lows, but I just don’t see it right now.
Let me remind everybody of my fundamental argument for why the lows are in:
- Gold is priced as if there were no economic, market, political or geo-political uncertainties.
- Silver is at or near the cost of production for many miners while the oil price is putting a floor under silver.
What has changed since I called the bottom some time ago?
There are economic, market, political and geo-political uncertainties everywhere, and silver is still at or near the cost of production, and the crude oil price remains above $67.50.
Gold and silver are not just going to sit here at these low prices forever, waiting for stackers, investors and potential investors to make a move, or an additional move, into the metals.
This is especially true if I’m right about my call on the stock market next week.
And I’m rarely wrong.
– 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.