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Silver and Gold Stocks Ready To Test Recent Lows

Cory
February 27, 2018

Doc joins me today to look at the metals charts and assess the likelihood of recent resistance to hold. We also look to the gold stocks and the near breakdown they are at.

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Discussion
83 Comments
    Feb 27, 2018 27:42 AM

    Gold has a date with the lower bull trendline which is basically intersecting the 200 WMA now. That intersection comes in around $1230, but we’ll probably go lower before the daily cycle ends, just for giggles.

    This intermediate gold cycle topped after only 6 weeks and the recent daily cycle topped on day 6. The gold daily cycles have been running about 40 days. That gives us *35 more trading days* to reach the low 1200s. That will be a piece of cake. I’ll tell you what, silver and the miners are going to already be in tatters when gold tags the 200 WMA.

      Feb 27, 2018 27:44 AM

      Sorry, misspoke, we’ve got about 29 trading days to reach a low. We are on day 11 currently.

      Feb 27, 2018 27:51 AM

      $gold put in a very rare black candle on December 14th at $1257 that was never cleared out. While I don’t put as much faith in $gold black candles as I do when the $HUI puts one in, it has been pretty reliable for $gold too.

      Therefore, I predict that by the second week of April, $gold will close below $1257.

        Feb 27, 2018 27:48 PM

        Black candles are not rare, and have almost no significance as they are neutral. Charts go up about the same amount of times as they go down after black candles.

        Friendly tip – just have the candles filled solid and make them red and blue and you’ll be a happier trader as these black candles seem to consume your mind.

        As for Gold at $1257 in April – that actually seems possible, but as long as it puts in a higher low above the most recent higher low at $1238.30, then what’s all the fuss about?

        Even at $1257 we’re still in the same bull market that started when Gold bottomed in Dec 2015 at $1045.40. Until gold takes that out or starts putting in a series of lower lows then who gives a flip?

        http://schrts.co/QnPCv7

          Feb 28, 2018 28:40 AM

          They are rare for $gold. And they are decidedly bearish almost 100% of the time. I am sure you might be able to find one or two black candles that never got negated in its history, but almost 100%, when you see a black candle for $gold it means we will get a close below that days closing price–i.e., they never mark a sustainable base. For the $HUI, it’s even more extreme. Since the 2016 low, every single black candle on the daily chart has been negated, and there is only one black candle on the weekly chart that still exists and that was the week of the absolute low in January.

            Feb 28, 2018 28:41 AM

            January 2016 that is.

            Feb 28, 2018 28:13 PM

            wrong there are black candles on tons of charts that move higher afterwards about half the time, and there is no significance to them other than how the open and close relate to the prior day. They are not inherently bearish if you spend any time studying them, and you have assigned far more importance and significance to them than they deserve.

      Feb 27, 2018 27:53 PM

      Averaged out and dumped my gdx holding on the bounce yesterday. Gold may correct $100 from the recent peak.

    Feb 27, 2018 27:35 PM

    The experts Spanky, Doc, Bob M, are all predicting a gold decline below $1300. HMMM! Whatever happened to Moody’s Investor Services. I would be more concerned with ” What on earth is happening”. Business isn’t great, credit is inflated, the debt for all governments and people is over the top. The stock market is at a dangerously high level, is there such a thing as a canny investor or are we all walking a tightrope? DT

      Feb 27, 2018 27:44 PM

      Then there is the Demographic problem of old people everywhere collecting government checks supported by a much smaller millennial generation that subsists on part time jobs. This is one crazy economy and one nutty world.

      Feb 27, 2018 27:48 PM

      DT; the PMs will have their day. Storm clouds are gathering in the distance.

        Feb 27, 2018 27:31 PM

        Question is, will me or my grandchildren still be alive when that day comes?

          Feb 27, 2018 27:57 PM

          Not if there is a catastrophe in the next 11/2 years.

            Feb 27, 2018 27:00 PM

            I don’t see it. The BoJ or ECB can and will buy US bonds hand over fist. The printing press is a wonderful thing.

            Feb 27, 2018 27:01 PM

            spanky – Bond buying is nearing the end of its run.

            Precious metals will break out above the 2016 highs by the end of the year, and will accelerate out of the rounded (or saucer) bottom they’ve been putting in for the last few years and head much higher on the right hand side of that pattern completing.

            spanky – Unless you plan on kicking the bucket in the next year or so, then you’ll see clearly the bull market continue to unfold, and what rubbish comments like silver will take 10 more years to base end up being.

            Cheerio!

      Feb 27, 2018 27:01 PM

      The Fed has your back. BTFD. Why would you speculate in a vehicle like gold when the Fed is telling you all of the liquidity is and will be being pumped into the stock market?

        Feb 27, 2018 27:08 PM

        Please post a link to where the FED has stated:

        “all of the liquidity is and will be being pumped into the stock market”

        I’d love to see where they said that, if they didn’t say that, then maybe lay of the hyperbole.

          Feb 27, 2018 27:09 PM

          correction: lay “off” the hyperbole

          Feb 28, 2018 28:46 AM

          It’s called reading between the lines. The fact is, Bernanke wrote an op-ed piece for the WSJ in which he stated that QE was being instituted to generate a wealth effect from rising asset prices. The Fed is not about to let a 4 trillion investment backfire, especially when they have unlimited credit and power and the coordinated help of other CBs, all with their own printing presses. Not only the 4 trillion in QE, but the 21 trillion in FEd and US govt backstops and guarantees made in 2008-09. The US govt and the Fed are literally “all in” on the stock market.

      Feb 27, 2018 27:24 PM

      Great comments by DT……..but, the milliennial are gain on the old farts……

        Feb 27, 2018 27:49 PM

        gaining

          Feb 27, 2018 27:10 PM

          The Generation X’ers are gaining on the old farts faster than the Millennials, but the forgotten generation is often……. forgotten….. 🙂

            Feb 27, 2018 27:11 PM

            For those with early onset amnesia Generation Xers were born between:

            1961 – 1981

      Feb 27, 2018 27:01 PM

      That worries me if Bob is on the same side I’m on as relates to PM direction.

        Feb 27, 2018 27:05 PM

        Doc – there are about a dozen analysts and commentators all on your side of the boat right now that are bearish on gold in the short to medium term. You’re en vogue! (I even put on a small JDST position to celebrate the occasion)

        Having said that….. Like Matthew mentioned over the weekend:

        “Most experts are in bearish agreement with Jeff/SKI and experts sway a lot of people. So if they are wrong, we will see a large move that only a tiny few will enjoy.”

    Feb 27, 2018 27:45 PM

    SLV filled the Feb. 12 gap to the penny today when it reached the Feb. 9 close (to the penny):

    http://stockcharts.com/h-sc/ui?s=SLV&p=D&yr=0&mn=5&dy=0&id=p43272111608&a=580236272

      Feb 27, 2018 27:53 PM

      Some bigger picture supports (it’s sitting on one now @ 15.48):

      http://stockcharts.com/h-sc/ui?s=SLV&p=W&yr=3&mn=7&dy=0&id=p16343705052&a=580235066

        Feb 27, 2018 27:56 PM

        That is the ugliest 50/200 WMA action I think I have ever seen. Talk about handrwriting on the wall.

          Feb 27, 2018 27:04 PM

          Perhaps, but the two year uptrend line is still a few percent below.
          SILJ told us 18 months ago that silver will ultimately be fine. Notice that the 50 wma crossed above the 200 wma 18 months ago — as if the price action wasn’t enough! (Lol)
          http://stockcharts.com/h-sc/ui?s=SILJ&p=W&yr=3&mn=3&dy=0&id=p83015004182&a=569144310

            Feb 27, 2018 27:14 PM

            You are being extremely generous drawing the lines for that descending wedge.

            Lower highs and lower lows for 19 months now. For most coherent people, that is a bear market.

            Feb 27, 2018 27:55 PM

            No, that top line just happens to present resistance before the line that you are picturing. One step at a time, right?

            Feb 27, 2018 27:56 PM

            You, btw, are a moron. Are you coherent enough to understand that?

            Feb 27, 2018 27:03 PM

            Please don’t take your frustrations out on me. That’s what your wife is for. I never flung insults at you, and never will.

            Feb 27, 2018 27:07 PM

            Your implying that I am not coherent is not an insult? What a punkass.

            Feb 27, 2018 27:21 PM

            When did I ever say *you* were not coherent? You are the most lucid person posting. Wrong yes, but very lucid.

            Feb 27, 2018 27:32 PM

            Ok, I’ll assume I was wrong about your intent. I apologize.

      Feb 27, 2018 27:53 PM

      Silver is setting up/flagging beautifully for another leg lower.

    Feb 27, 2018 27:58 PM

    Doc, when the PM’s pull back over the next while, what would be a good gold and a good silver stock to look at (not investment advice) and what entry level do you see them going to by May? I assume you have some favorites.

      Feb 27, 2018 27:05 PM

      GG for one. I wouldn’t be surprised if it tests it lows at about $10.50. I hope it gets down there since I’m a big buyer unless the TA at that time still predicts a breakout lower. I also will add to my AUY position at 2-21/2 dollars–hopefully closer to 2 dollars. HMY on a pullback close to $1.58. I hope to add to ASM at about $.80-$1.00.

    Feb 27, 2018 27:40 PM

    A bit of history on Powell. Biased for those who care about such things: http://news.goldseek.com/GoldSeek/1519764727.php

    CFS
    Feb 27, 2018 27:48 PM

    My vote for the first US female President:

    https://www.youtube.com/watch?v=oSk35azfuJE

    Nice if Trump would pick her for VP in 2020.

    Feb 27, 2018 27:48 PM

    “The boom cannot continue indefinitely. There are two alternatives. Either the banks continue the credit expansion without restriction and thus cause constantly mounting price increases and an ever-growing orgy of speculation – which, as in all other cases of unlimited inflation, ends in a “crack-up boom” and in a collapse of the money and credit system. Or the banks stop before this point is reached, voluntarily renounce further credit expansion, and thus bring about the crisis. The depression follows in both instances.” – Ludwig von Mises

      Feb 27, 2018 27:33 PM

      Sure it can’t continue indefinitely. But anything short of indefinitely could be a long long long time.

        Feb 27, 2018 27:11 PM

        No the public is going to run out of credit……which is happening right now.

          Feb 27, 2018 27:12 PM

          Housing, food, autos…………All OUT OF CONTROL

    b
    Feb 27, 2018 27:04 PM

    Thats what they are counting on.
    a good crisis expands their power and wealth.

    Thats how they have worked for ? 100+ years anyway.

    Shoulda invested in the banks long ago. lol

    Feb 27, 2018 27:13 PM

    SLV:GLD looks terrible on every timeframe. It literally had a 5 month relief rally out of the last 7 years (it’s been making lower lows and lower highs against gold the rest of the time) and that was enough to get everyone hootin an hollerin’. Once we break below the 2016 low, and make no mistake we will, it will only then be painfully obvious that silver has been and still is in a bear market in real terms. It’s probably the most over valued commodity in the complex second to gold. It has a long way and time to keep falling. The fact that it has completed a near 100% retracement against gold over a two year period should speak volumes to anyone with functioning brain cells.

      GH
      Feb 28, 2018 28:15 AM

      So anyone who disagrees with Spanky doesn’t have functioning brain cells?

      But you never insult people? Right.

        Feb 28, 2018 28:47 AM

        Your reading comprehension needs work.

          GH
          Feb 28, 2018 28:50 AM

          I don’t think so. You’re obnoxious.

            Feb 28, 2018 28:08 AM

            Of course you don’t. I’m guessing sub-600 Verbal. Am I right?

            GH
            Mar 01, 2018 01:07 AM

            About as good as the rest of your guesses.

            If you can’t understand the obnoxious nature of your posts that’s on you.

    Feb 27, 2018 27:20 PM

    SLV actually has very bullish weekly chart, if you turn it upside down. I mean beautiful bullish alignment of the MAs and they are still tight. It’s primed from a serious run on the upside down chart.

    Feb 27, 2018 27:26 PM

    On many silver miners (see AG for example), the 50 WMA has now crossed back below the declining 200 WMA. These miners are wonderful shorts on any touch of the 50 WMA. Hell any touch of the 20 WMA should be shorted as they may not get close to the 50 WMA for a long long time.

      Feb 27, 2018 27:28 PM

      Again, if you turn these charts upside down, they are beautifully bullish looking.

        Feb 27, 2018 27:56 PM

        Bearishness is fine. I mentioned on yesterday’s blogs that I took out a JDST position as a hedge against my weighting in mining stocks. There are a number of analysts I respect that share in the current bearishness.

        However, it is this incessant posting from spanky about how he is so sure the mining stocks will take years to base, or are set up for a waterfall decline, or are the ultimate short that are so at odds with his claims that he is holding on to his Silver miners due to the capital gains he has in them (WTF??).

        If spanky had any conviction in anything he posts, he’d sell all his silver stocks, short the miners, and go long Amazon to infinity and beyond. There would be no point in slumming it here on a tiny resource markets focused website, but spanky is still long his silver stocks, and has some messed up need to be over-the-top bearish as some sort of coping mechanism.

        But alas….. spanky is all bark – no bite. Deep down I think he really is rooting for the PMs.

        Nothing he posts is congruent with the action he actually takes, so how valuable are the insights if even he doesn’t really believe them?

        Tragic comedy.

          GH
          Feb 28, 2018 28:18 AM

          Who wants to listen to anyone whose words and actions are contradictory?

          Feb 28, 2018 28:53 AM

          My problem is I invest for how things ought to be, not how they are. IMO, there is nothing irrational about the stock market going vertical based on the express language of the Fed and other CBs. It’s Zimbabwe 2.0.

          Sure, the “market” will in time discount all of this BS, but in the short run, i.e., our lifetimes, the CBs are basically omnipotent. Frankly, there is absolutely no logical reason commodities are at 50+ year lows (I’m talking about as a complex).

            Feb 28, 2018 28:47 PM

            I agree that none of it logically makes sense, but if you are so convinced the miners are going to hell in a handbasket, then why don’t you sell them all and exit the sector?

            Holding on to Silver stocks when you think Silver is one of the worst markets makes no sense at all and when you say they are utter trash, but that you have capital gains in them, then how trashy can they really be?

            None of the projects you post about add up with you holding miners at all or even posting here on a resource blog. If I hated Silver and thought they were the ultimate short, and would base for 10 years, I wouldn’t waste 1 second of time posting charts about commodities, and I’d be on a generalist blog getting jacked up on the FAANG stocks. It’s just an odd disposition to have.

    Feb 27, 2018 27:15 PM

    StarbucksCoin? Exec Says Coffee Seller Will ‘Probably’ Use Blockchain

    Stan Higgins – Feb 27, 2018

    https://www.coindesk.com/starbuckscoin-exec-says-coffee-seller-will-probably-use-blockchain/

    Feb 27, 2018 27:55 PM

    Doc, did you notice the huge move up in NSRPF today as other gold stocks tumbled? It exploded through the neckline of the head and shoulders bottom. Ought to go higher if Edwards & McGee are right.

    Feb 28, 2018 28:10 AM

    I like silver and am bullish shortish, medium and long term. My two main picks, IPT and SCZ are doing fine this year after buying both near to their lows. I have been negative from my frustrations also but can see clearly now that silver is going to outperform IMHO. My instincts have never been so firm.

      Feb 28, 2018 28:02 AM

      Well, at least in the short term, prepare to have your “instincts” shattered.

        Feb 28, 2018 28:27 PM

        I’m a big boy and can take it. I appreciate your input but sometimes it sounds like my old negative inner chatter that got me on the wrong side of trades all the time. I have no fear of being wrong on this because I have invested the proper amount and have already taken profits from the baseline.

      Feb 28, 2018 28:26 AM

      Dan, I obviously think your instincts will prove to be correct. And that IPT does look good…

      http://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=5&mn=6&dy=0&id=p39720263501&a=533204677

      Spanky: did you see the “ish” on the “short”? Dan said he is bullish in the shortish term. Duh…

        Feb 28, 2018 28:06 PM

        Well if shortish term is anything shorter than 1 month, he’s in for a treat. IPT.V has been range bound below key weekly MAs for a long time. That’s potentially a setup for a big move down at some point. If you recall, I did however say that March should mark an important low in the silver miners based on nothing more than the nadir of the monthly Ichimoku cloud. I told you and Ex that IPT didn’t have a chance of penetrating the cloud, and I was right. If it is going to rally, the time is soon (I would think April or May at the latest).

          Feb 28, 2018 28:12 PM

          Like the average clueless investor, you also were very bearish IPT at the low – before it moved up over 50% in a couple of weeks. It is still up almost 50% yet you believe that you somehow nailed something. I don’t know why you aren’t embarrassed.

          Feb 28, 2018 28:28 PM

          To me it looks ready to break out. And one month is shortish.

        Feb 28, 2018 28:09 PM

        And it’s too bad the rest of the complex isn’t indicating any sort of moonshot in the shortish term.

          Feb 28, 2018 28:12 PM

          Who said anything about a moonshot?