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PREMIUM MEMBERS

Now everything's a little upside down,

as a matter of fact the wheels have stopped.

What's good is bad, what's bad is good.

You'll find out when you reach the top

you're on the bottom.

- Bob Dylan, from Idiot Wind 

 

Just when we thought it was safe to ignore Cyprus, chief European banker, Mario Draghi, blurts out. Five-year-olds blurt. Teenagers blurt. Lovers in a quarrel blurt. Responsible people in enormously powerful and sensitive positions do not blurt, should never blurt.

Perhaps in the aftermath of a very large and very deep recession, we should be expecting contradictions in all kinds of markets, from gasoline to food, from pork bellies to gold to currencies.

We indeed are getting them. This may sound philosophical, but there are the actual contradictions, then there are the radical reactions to such contradictions. Even Goldman Sachs, which has downgraded its gold price outlook twice in the last 45 days and continues to talk it down, very clearly says in their analysis of gold that economic growth in the United States will be modest for the rest of this year and into 2014. That would mean unemployment will stay high for a longer time than hoped for, which should mean the Fed will keep priming the pump. But gold gets no lift under its wings for that. 

Yet another strange contradiction occurred in markets today. The S&P 500 normally moves in opposition to the price of gold. Today, however, the S&P is down almost as much as gold (the former 4.5%, the latter 5%). And, as if wonders will never cease, U.S. treasury issues were trending down for the week until today. So, gold is not a safe haven, government paper is not a safe haven and equities are shaky. Is all this money going under rocks somewhere? Under a mattress? The most important thing that can be said about today's plunge is that as gold and silver float lower, we can be first in line to ride it right back up.

 

As always, wishing you good trading. 

 

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Gary S. Wagner

Executive Producer/The Gold Forecast

gary@thegoldforecast.com 

On Skype Gary.S. Wagner


Market Forecast: On a technical basis today’s market activity can be best characterized as an absolute free-fall as we witnessed both gold and silver breakthrough critical levels of support. Whether it is the news that Greece will have to sell its gold holdings to cover its banking crisis, raging US equities markets, or the belief that the United States Federal Reserve will begin to change its current monetary policy the net result was an absolute meltdown of both gold and silver prices. With 5% losses in both gold and silver the absolute question remains where this free-fall might and whether or not we have entered into a bear market. Today’s video will look at levels of support in both gold and silver and look at the long-term damage inflicted on the charts with today’s tremendous downside move.

 

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COT LINK

See previous weeks in Historical Commitments of Traders Reports.

 

Proper Action: 

 

No current position in gold or silver

 

Gary S. Wagner - Executive Producer