|
1.When titans clash, reverberations are felt around the
world.The US central bank has begun a titanic clash with the US government,
and as the battle unfolds, all markets will be impacted significantly.
2.Please click here now. Double-click to
enlarge.This short term chart shows gold beginning a small uptrend, with
higher lows and higher highs.
3.Please click here now. Double-click to
enlarge.A broadening formation is now in play on this key daily gold chart.
4.Broadening formations are formed by higher highs and
lower lows, and these patterns indicate a loss of control in the
market.
5.I predicted the Fed would hike rates in 2015, and that
would be a warning shot to the US government to get its financial house in
order, or more hikes would follow.
6.I do not believe the Fed's first rate hike had anything
to do with GDP or employment, and nor will the rate hikes that follow.The Fed
is enticing banks to move the "QE money ball" out of
government bonds and T-bills, and into the private fractional reserve banking
system.
7.There, it can be loaned out more profitably, and money
velocity will begin to rise. For the first time in US history, rate hikes are
not being used to cool inflation, but to heat it up.Rate hikes raise the cost
of borrowing money for the government, and for stock market buyback programs
that have created questionable price/earnings ratios in the US stock market.
8.Gold is trading in a broadening formation because
institutional investors are beginning to sense a loss of control, emanating
from both government and central banks.
9.I expect gold will trade essentially sideways until
mid-July, which is when it often bottoms anyways.That's because early
preparations for gold-oriented Diwali begin in India, and demand begins to
surge.
10.Demand from India was weak in 2013 because of the
imposition of a duty and import restrictions, and in 2014 and 2015, because
the monsoon season in both years was very dry.
11.The 2016 monsoon season looks good.It should produce
great crops, and gold demand from millions of farmers will rise significantly
as that happens.Please click here now. India just killed the
tax on cash purchases of jewellery.That's very good news for farmers.They
will be holding a lot of cash as their crops are harvested.
12.Also, if Janet Yellen hikes rates in July, not only
will she be hiking just as Indian demand picks up, she will be doing so just
as the US stock market enters what I call "crash season".That's
the August - October time period.
13.If Janet hikes in September, the damage to the US
stock market could be even worse.Goldman analysts predict she will hike in
both September and December.That would put enormous pressure on both the
US stock market and US government bonds.
14.Please click here now.Powerful JP Morgan
analysts have forecast gold will surge to $1400 in the second half of 2016,
and now Citi adds a nice price forecast.
15.Please click here now. Double-click to
enlarge this GDX daily chart.I realize that some of the "old guard"
of the Western gold community envisioned gold soaring to stratospheric prices
as the US government debt crisis deepened.
16.Gold forecasts of $1400 from banks like JP Morgan may
not sound very exciting to investors who envisioned gold at much higher
prices by now, but it's important to understand that it only takes a modest
amount of upside action in the price of bullion to create dramatic
movement in the price of gold stocks.
17.Gold bullion rose about 25% from the December lows to
the May highs, and GDX surged about 100% in the same timeframe!Many
individual gold and silver stocks staged "five bagger" and
"ten bagger" performances.
18.Please click here now. Double-click to
enlarge this daily silver chart.
19.Next, please click here now. Double-click to
enlarge.Silver bullion rallied about 30% from the $14 area lows to about $18.
20.In the same time frame, the SIL silver stocks ETF
surged well over 100% higher.What is even more important, is that while
silver bullion has now fallen about 25% from the $18 area high, the SIL
silver stocks ETF is only down about 15%!
21.How is it possible for gold stocks and silver stocks
to pullback so slightly, after such a huge rally, even while bullion has a
solid pullback?
22.It's possible because so many powerful value-oriented
institutional investors are showing great concern about coming inflation,
loss of control in government and central banking, and overvaluation of the
US stock market.They are buyers of gold stocks and silver stocks on price
corrections, price rallies, and when they trade sideways!
23.A real correction is coming to the gold market, but
I don't believe it will happen until well into the 2017 calendar year.A
lot of US economic reports will be released this week, including the jobs
report on Friday morning.Gold has a strong tendency to rally following the
release of that report.
24.Investors who may have recently become somewhat obsessed
with calling a gold price correction may want to consider throwing a bit of
caution to the wind.This is a time for investors to position themselves for
the next wave higher, and for gold stocks, that wave may just begin on Friday
morning!
Thanks!
Cheers
st
Stewart Thomson
Graceland Updates
Note: We are privacy oriented.We accept cheques.And
credit cards thru PayPal only on our website.For your protection.We don't see
your credit card information.Only PayPal does.They pay us.Minus their
fee.PayPal is a highly reputable company.Owned by Ebay.With about 160 million
accounts worldwide.
Written between 4am-7am.5-6 issues per week.Emailed at
aprox 9am daily.
www.gracelandupdates.com
www.gracelandjuniors.com
www.gutrader.com
Email: stewart@gracelandupdates.com
Or: stewart@gutrader.com
Rate Sheet (us funds):
Lifetime: $799
2yr:$269(over 500 issues)
1yr:$169(over 250 issues)
6 mths: $99 (over 125 issues)
To pay by cheque, make cheque payable to "Stewart
Thomson"
Mail to:
Stewart Thomson / 1276 Lakeview Drive / Oakville, Ontario
L6H 2M8 Canada
Stewart Thomson is a retired Merrill Lynch broker.
Stewart writes the Graceland Updates daily between 4am-7am. They are sent out
around 8am-9am. The newsletter is attractively priced and the format is a
unique numbered point form.Giving clarity of each point and saving valuable
reading time.
Risks, Disclaimers, Legal
Stewart Thomson is no longer an investment advisor. The
information provided by Stewart and Graceland Updates is for general
information purposes only. Before taking any action on any investment, it is
imperative that you consult with multiple properly licensed, experienced and
qualified investment advisors and get numerous opinions before taking any
action. Your minimum risk on any investment in the world is: 100% loss of all
your money. You may be taking or preparing to take leveraged positions in
investments and not know it, exposing yourself to unlimited risks. This is
highly concerning if you are an investor in any derivatives products. There
is an approx $700 trillion OTC Derivatives Iceberg with a tiny portion
written off officially. The bottom line:
Are You Prepared?
|
|
