Forget all the garbage you are most likely to read on the internet this weekend from the usual suspects who will spin today’s sell-off in gold and silver a co-ordinated event. If they thought that this was a planned smash they would have done the responsible thing and warned their readers to sell their bullion before the smash to buy it back later. It takes one well thought out argument laden with circumstantial evidence and misguided and most often incorrect facts to start the ball rolling on what will be a weekend full of perma-bulls regurgitating each others nonsense, talking as if they knew this smash was coming without telling their readers to prepare for it. Then again, we know of one perma-bull who sold before this event, Eric Sprott himself.
The reality is that anyone willing to pay attention to the charts and all leading indicators should have seen today coming. Perhaps and admittedly not as violent as things transpired but the breakdown in platinum and copper 3 weeks ago that we discussed here was a red flag. Then came other breaks of critical support after a lengthy consolidation phase and the break of the HUI from a 3 year topping process. All items that we warned readers about on this blog. (We have been bearish gold and silver on a big picture basis since late 2011).
The other day I provided a lengthy post on what your levels were if you wanted to trade these markets. After warning readers that if the $1620 level failed on gold, we could be on the way down in a big way we also laid out, as clear as day, levels to watch in upcoming trading.
Sure enough, each time one of those levels were breached, gold and silver accelerated lower to the next levels. Remember, broken support now becomes resistance. If you played along with my roadmap today you made yourself some serious change.
Now here’s the deal. Expect a ton of margin calls over the weekend. Either come up with the money or face liquidation will be the central theme of those calls. I don’t think there will be any sustainable bounce in the metals but instead any bounce will be counter-trend and short-lived. The magnitude of today’s technical damage is beyond words. It will take a lot to recover from today’s LIQUIDATION event.
Forget anyone trying to sell you the old story that today was a contrived smash. Especially of they start referring to events at the beginning of the month that were all part of the script or the Goldman Sachs downgrade which surprisingly enough was being touted as bullish buy some of these metal touts. If any events earlier this month were all part of the script and these people claiming an orchestrated smash claim they were then double shame on them for not warning investors to get out of the market place to perhaps buy back in cheaper at greater quantity.
The usual suspects are at it, trying to comfort their readers and trying to get them to believe that today’s sell-off in gold was an orchestrated “Smash” by the Federal Reserve.
They are all out in droves, perhaps with egg on their faces for shamelessly touting the yellow and white metals as the only true safe places to be despite the fact they have been declining in value ever since 2011. They should all be ashamed. Each and every one of them, for never once recommending lightening the load in the precious metals space in the face of uncertainty.
Now we are going to hear stories all weekend long as to how this move was an orchestrated smash by the Federal Reserve in conjunction with the bullion banks to destroy gold and silver’s lustre. (mainly gold)
I have this to say to these charlatans. NONSENSE!
Of course, the good old cheerleading camp at King World News already has their “whistle-blower” Andrew McGuire talking about the paper take down (whose ‘evidence’ the courts have already determined holds little to no weight at all – so they might want to stop calling him a whistleblower because it makes them look more silly).
Eric King has even trumpeted out Former Assistant of the US Treasury, Dr. Paul Craig Roberts to talk about today’s orchestrated smash in gold. (Read Here), Here’s the part of the interview that get’s me. Dr. Roberts says that the orchestrated sell-off has been in the works since the beginning of April starting with brokerage houses telling their clients that hedge funds and institutions were going to be dumping gold and that they should get out in advance and then it culminated with Goldman Sach’s sell recommendation on gold the other day.
Tell me something then, IF that was what was truly going on, why didn’t this guy go on KWN at the start of April and tell everyone to sell their gold to buy it back later for cheaper? Why didn't he suggest to King’s listeners that this smash was coming and that investors might want to front run the smash to pile in later at lower prices? Even after GS made their recommendation all we heard was how that was a great contrarian indicator but at no time did any of those people claiming this was a smash suggest actually taking the advice of Goldman Sachs? Because these fantasies are only manufactured after the fact, using circumstantial conclusions on one’s circumstantial analysis of the facts.
On April 10th, Jim Sinclair told KWN that the raid on gold was on. He said that gold would probably go down $25.00 and then rocket higher by hundreds of dollars. If he knew the raid was on, why didn’t he recommend selling?
That same day, another one of King’s regulars, Trader Dan Norcini told King that in his view, a significant amount of money was moving against hedge funds that were shorting gold and silver and if those same funds buckled on their bet, we would see “massive moves in gold, silver and those other key commodities”. He said that the markets would surge higher in violent fashion. Curiously, this perma bull didn’t recommend selling gold or silver at that time to buy in cheaper for fear of a massive “smash” on the horizon.
It’s easy for all of these guys to come out now and talk about how today’s selling was orchestrated. Question is, why didn’t they tell any of their avid readers or followers about what was going to happen if they now claim the events were obvious at the beginning of the month?
For years these guys have been singing the same tune about the meteoric rises that were on the horizon for both metals. For a while they were right and along the way they attracted many readers and new followers. However, despite the massive amount of easing and every event they claimed was going to springboard gold and silver higher failing to do so, and in the face of the massive chart damage done to silver and gold during this decline, they never once suggested to their readers that they unwind some of their position. THAT is perhaps more criminal that the liquidation event that took place today.
I maintain my lower targets for gold and silver. Today’s technical damage was extreme. Silver barely survived its support shelf. We saw what happened to gold when its support shelf at 1529 broke.
I’ll be back this weekend with more and I will not stop exposing these frauds who are trying to keep people believing the fantasies and lies associated with the world of physical gold and silver ownership. Too many people have seen their finances crushed because they continued to drink the kool-aid that these “knowledgeable” people fed them. If the years leading into 2011 were the “pump” then my friends, the “dump” has started.
