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Precious metals could be bottoming

October 5, 2015

Here is a recent posting by our friend Peter Brandt. I always listen when Peter makes a change to one of his calls because he has no qualms about being bearish on any asset especially the precious metals.

Click here to visit Peter’s site.

Buy signals in Silver and Gold are setting up

For the first time since the precious metals topped in 2011, both the Silver and Gold charts are constructing possible bottom configurations.

[For background on the importance of classical chart construction in the Gold market, please read β€œThe History of Gold Charts” here.

The monthly Gold chart displays the bear trend that began with the completion of a major descending triangle in April 2013.

10.2_GC_M

The daily Gold chart displays a possible 10-week symmetrical triangle bottom. Of all the major classical chart patterns, the symmetrical triangle is the least reliable (by far). Yet, a completion of this pattern by a close over 1160 would be an indication that the major trend in Gold has turned up.

10.2_GC_D

As shown on the weekly graph, the decline in Silver from the 2011 high has been one for the textbooks. The decline has complied with the principles of classical charting as well as any other market in recent years.

10.2_SI_W

The daily Silver chart is forming a classical H&S bottom pattern. A decisive close above 1550 would complete this bottom and indicate that the 4-1/2 year bear trend in Silver is over. Of course, a considerable period of time of further base building could occur before Silver enters another bull phase.

 

10.2_SI_DThe information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

Discussion
53 Comments
    Oct 05, 2015 05:34 PM

    Happy to see what I posted yesterday πŸ™‚ !

    Oct 05, 2015 05:56 PM

    His quote surprised me – “Of all the major classical chart patterns, the symmetrical triangle is the least reliable (by far).”

    I had no idea it was that unreliable. I stand corrected.

    Now I’m swaying into Gary’s camp – not for cycles but because GDX usually leads GLD, and GDX is breaking out, that’s a fact.

    At the moment, GDX’s 1 hr chart shows RSI(14) as overbought, so we get a pullback next. I’m thinking to get in then, as long as it’ makes a higher low on a daily chart.

      Oct 06, 2015 06:36 AM

      I thought that was interesting also…..his quote on the” symmetrical triangle”

    Oct 05, 2015 05:19 PM

    Just to add, $SILVER broke out today. So SLV is leading GLD, as well as GDX is leading GLD. Man, Gary had this down.

    I will still wait for a pullback – will be using 1 hr charts to see it, as on the daily chart it might not look like much.

    Oct 05, 2015 05:30 PM

    Saxo Capital Markets Steen Jakobsen Increased Gold Investments To 20% Oct 5.

    Oct 05, 2015 05:27 PM
      Oct 06, 2015 06:45 AM

      “now favors silver longs”……I like that comment. J.THE LONG

      Oct 06, 2015 06:04 AM

      Good article on Silver and there are some good charts embedded. Thanks!

        Oct 06, 2015 06:10 AM

        YOU on break…………..better get back to work……. πŸ™‚

          Oct 06, 2015 06:43 AM

          playing “dodge” ball at work…… πŸ™‚

    Oct 05, 2015 05:29 PM

    Just don’t forget to post again IF the charts lose shape and Peter updates us that precious metals have another leg down ^^ , not just post bullish analysis

    CFS
    Oct 06, 2015 06:09 AM

    Platinum is looking interesting for a major upturn in a week or so.

    This is also worth watching:
    http://usawatchdog.com/fed-plan-is-print-money-until-system-blows-bix-weir/

      Oct 06, 2015 06:46 AM

      Last week it was below 900 …at 898?….the ratio turned last week 1.27 to gold…I thought that was noticeable……

      Oct 06, 2015 06:00 AM

      BIX is saying the same thing that several other guest have said……..

      Oct 06, 2015 06:23 AM

      PLATINUM JUST POPPED HIGHER……………..

    CFS
    Oct 06, 2015 06:17 AM

    Listening to Kerry over the last few days……God help US…….He has shown his complete ignorance of Russia and its capability.
    When one is that stupid, one really ought to keep silent! Utter ignoramus, and he is a veteran!

    Obama has the reputation of not listening to advisors, so the possibility of a really stupid mistake looms large.

    Oct 06, 2015 06:52 AM

    GLENCORE…….RECRASHING ………….zerohedge

    Oct 06, 2015 06:24 AM

    Upwards pressure on gold and silver prices despite Chinese holiday.

    “The Technical picture is now moving to a critical point which may see a strong move this week. ”

    http://lawrieongold.com/2015/10/06/upwards-pressure-on-gold-and-silver-prices-despite-sge-being-closed/

    Oct 06, 2015 06:00 AM

    YUAN RISING…….as 4th most used currency……….think gold backing.

      Oct 06, 2015 06:02 AM

      US export shrank……imports higher……….we owe more to China.

        Oct 06, 2015 06:31 AM

        It looks like the goal to capture manufacturing from china in the late 8 years is not that successful, right?

    Oct 06, 2015 06:38 AM

    Gold and silver prices were so suppressed. Any contrarian should go long. The people who is bearish or even short will deserve what they will get

      Oct 06, 2015 06:53 AM

      CCF………says bear is over…………………I say shorts are getting the wood shed treatment today……….

        Oct 06, 2015 06:07 AM

        MIN WAGE INDICATOR……..One oz of silver is now about equal to… one hour min. wage…….so, mom and pop are going to buy…………CCF

    Oct 06, 2015 06:38 AM

    We can look what happened yesterday at this indicator which precedes the rally in gold prices for $US. With gold prices down somewhat the indicator moved up instead, indicating another rally to take place:

    http://schrts.co/Ly3cNI

      Oct 06, 2015 06:46 AM

      I like to use Gold silver ratio to predict for the next a little while. If GSR goes down even gold goes down, it means the pressure from under is heavy.

        Oct 06, 2015 06:54 AM

        I find that the gold/silver ratio doesn’t give you a forward looking indication. It’s not really an indicator of anything, though it did pick out when commodities topped in 2011. The ‘real’ top in commodities came in 2008. The gold/silver ratio has been warning for years, however that credit is deteriorating.

          Oct 06, 2015 06:44 AM

          Every time I find if gold is down and silver is up or down much less, the downward move is going to be over or upward starts. It works most of times. I think it is because the cartel has gold but not silver. So they may need to sell gold and cover silver. Just my own thought.

          This rarely happens rarely so I like to watch for this rare occasions. But it happens quite often lately though.

    Oct 06, 2015 06:45 AM

    pah! ‘With the indicator moving down, gold prices moved down’

    bb
    Oct 06, 2015 06:08 AM

    Jim Goddard report. I found it on sgtreport today.
    Talking about the tpp agreement, I guess part of it is any unauthorized reporting of corporate news/info will be punishable.
    kinda funny, not really of course but nobody will do anything.

    Wont be any info on the net I guess, any comment on a site like Ker, could be jail.
    The Nazis of the 30s/40s went back 10 years to find dissenters.
    This really has been/is a step by step process.

      Oct 06, 2015 06:26 AM

      TPP ,,,,,has to be voted in congress first to be done…….

      Oct 06, 2015 06:28 AM

      What is funny , the corporations should wake up ,,,,because they are the NEW TARGETS.

        bb
        Oct 06, 2015 06:39 AM

        My guess is it gets passed.
        If only in part it will be amended over time.

        I really thought the “no reporting” on corporations was………….interesting.

    Oct 06, 2015 06:44 AM

    I thought that Peter Brandt’s charts from the gold bear market from 1980-1999 were very interesting. I linked to them somewhere on the blog a while ago. I will look for the link:
    http://peterlbrandt.com/history-of-gold-in-charts-updated-version/

      Oct 06, 2015 06:50 AM

      The guys who say that you cannot do analysis on a ‘manipulated’ market would get short shrift from Peter Brandt. He says:

      “The Gold market is the ultimate market for classical charting principles”

      this is what he said on 7 August at the above link:
      “The next bull market (on a monthly scale) in Gold (if and when) will be ushered in with a clearly recognizable weekly chart pattern. No such pattern exists. Thus, my quess is that Gold will go to new lows for this bear phase with a breach of 1,000 very possible.”

      So he has started to change his mind because he has now found a chart pattern that he likes.

    Oct 06, 2015 06:04 AM

    I was surprised to see that silver popped over $16 today to $16.05. Good looks OK but silver looks better.

    http://stocktwits.com/symbol/GC_F

    http://stocktwits.com/symbol/GC_F

    I got these links from Peter L Brandt’s blog.