The broad market, supported by the glorified boiler
rooms on Wall Street, the glorified infomercials in the mainstream financial
media and the glorified monetary clerks at the Fed, operates to its own set
of rules and cycles. For instance, now we have conventional investors who
used make cracks about their 401k's becoming 201k's actually becoming hopeful
that they will regain all of their lost value. The wonders
of inflationary monetary policy has brought this prospect
tantalizingly close to becoming reality. Close, but...
Over in the gold sector however, where investment is actually a form of
revolution (against inflationary fiat monetary systems), it is not so easy.
Investors simply must be mindful of the risk vs. reward setups at all
times because the same forces arrayed in support of the stock market are
lined up against the barbarous relic. I am not saying this is a
conspiratorial cabal, but I am saying that macro manipulation (like the
recent 'reworking' of US Treasury yield curves) is just the way it is,
whether it is planned out in the shadows to the most minute details, or just
the result of embedded 'business as usual' academic myopia in a fiat system.
Take today for instance; it is a fine day for precious metals investors who
are prepared for it. The caution signals were all there and it is now time to
think like a capitalist... like a predator... like a revolutionary... like
someone who avoided the worst of what the manipulative entities had to dish
out and is now in evaluation mode as to how to proceed.
You are a precious metals player? You are at war. Win the friggin'
With that, we take a quick reading of two indicators NFTRH and its
subscribers have been watching.
Bullish Percent Index on the GDM gold miner index
can continue to decline to target. Will this come with a final regurgitation
and capitulation? I don't know, so that is why I am slowly picking off
individual items as they come on sale. We began watching this one when HUI/GDM
failed to make a higher high at the equivalent of HUI 555 in February.
We have been watching for a projected double bottom
in the leading HUI-Gold ratio for the better part of a year now, since it
broke below an important moving average. This has allowed NFTRH analysis to
temper its enthusiasm despite wildly bullish bigger picture projections. We
are almost there folks, and I suspect a large portion of the gold 'community'
wishes it had more cash reserves in the event this signal registers.
When you are at war, you do not personalize the enemy. You plot, you analyze,
you gain intelligence and you survive long enough to employ tactical
Given the sentiment backdrop, which we have also been keeping a close eye on,
one wonders if the massive topping pattern on the weekly HUI (yes, we are
factoring that as well) is little more than fodder for trend followers and
gold perma bears to scare gold bugs with.
What the heck, let's throw up (apt wording, isn't it?) one more graph. Sentimentrader.com's Public Opinion data out just two
days ago has finally taken a hard lurch down to where a precious metals bull
with cash on hand would want to see it. Unless the rules have changed, you
never but never feel actionably bullish when the public is red lining bullish
optimism and you never but never get bearish - as long as the secular bull
remains intact - when it is green lined.
The working price target for Au is lower, but we are getting there and I am
getting more bullish by the week because data points are starting to converge
all over the place. There is a level of concern about the technical pattern
on HUI, GDM, etc., but in the precious metals, sentiment usually wins and it
surely has the power to invalidate a chart pattern; neuter it if you will. We
shall certainly see soon enough.
You have got to love the markets. You
really have got to.