A contrarian indicator just tripped. Here’s what it could mean for the white metal…
Are contrarian indicators real?
Look at none other than Dennis Gartman this week and think about it, because the question is rhetorical:
NEW RECOMMENDATION: We wish to sell WTI and Brent Crude short this morning upon receipt of this commentary, predicated upon the massive narrowing of the backwardation in both and predicated of course upon the “reversals” suffered by both. We’ll have stops in tomorrow’s TGL, but for now we’ll risk $1.20/barrel from the current level, looking for $5-$7/barrel to the downside and one unit of each shall suffice.
To which we said that while as of 11am on Tuesday oil was up only 22 cents, “those who hurry can make a quick buck as Gartman is stopped out in the next day or two.”
Well, it wasn’t “two”, because just one day after Gartman turned short oil…
… he has been stopped out, after oil surged $2 higher from Gartman’s entry price.
Now fast forward to today and we have a possible contrarian indicator tripped.
Peter Brandt is some sort of ‘Market Wizard’ who has been in the markets for decades, particularly the commodities markets.
And he is an outspoken precious metals price suppression denier.
There is NOOOOOOOOO manipulation of the Gold market. Conspiracy theories breed wildly among crypto and metal bulls
— Peter Brandt (@PeterLBrandt) January 25, 2018
That said, people who deny the reality of the markets are often wrong on their calls.
Case in point: Peter Brandt on March 19th said gold was going to $1228 (and he even said he went short).
Now, what has gold done since March 19th?
Well, gold got nearly $150 higher than where Brandt said gold was going, and gold put in 52-week highs before the cartel decided they had enough and smacked it down a bit.
Attempt was made to contact Brandt to see if he got stopped out of his horrible call, though a response was not given.
Well today, once again, Brandt is out there, but this time he’s showing off his technical work and saying that silver just triggered a “buy” signal for Brandt:
— Peter Brandt (@PeterLBrandt) April 20, 2018
Which would generally be a good thing, but since we’re looking at the possibility of a contrarian indicator, this might not be the case today.
This could be a bad thing if you’re wanting the price of silver to rise.
So a question: Is past prologue?
And another: Are contrarian indicators real?
And one final question: Has Peter Brandt worn out his welcome as a ‘markets guy/trader’, and he’s now acting/working as a contrarian indicator?
If the answer to either of those questions are a “yes”, or if all three of those questions can be answered “yes”, we very well might be taking a trip back down to $16 before we get over the crucial $17.50 mark, and especially the extra-crucial $18.50 mark.
Today should be interesting nonetheless. We’ll see how well silver can hold up today. A close above $17 to finish out the week would put silver up three weeks in a row, and a close above $17.30 would be bullish, and $17.50 very bullish heading into next week.
But with Regional Fed Heads Evans and Williams doing some good old-fashioned Fed Jawboning this morning and late morning, and with the cartel desperate to get silver to close below $17 to finish out the week with a buzz kill, I would look at any weakness in silver today as a gift from the cartel and an opportunity.
I hope I’m wrong about this and we quickly get back above $17.25.
We’ll know soon enough.
– 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.