Apr 29, 2011

1.    The week has been intense.  It only makes sense that as silver rises to "Gold $1000" that a huge battle would take place.  It is a monster HSR (horizontal support and resistance) point.

2.   It is NOT a "top".  Weak players are sellers of core positions, and strong players are sellers of trading positions.   In terms of the biggest liquidity flows, it is weak selling hands feeding weak buying hands.  One clown helping another does not make either party any money.   

3.   Nobody should be a silver buyer of size at this point.  You should be enjoying the ride.  If you want action, buy call options, not core positions.

4.    The strong hands are holding their core tightly, getting richer, and anticipating a wild move above the key $52-54 high, and the $50 round number emotional barrier.

5.   You pay me to add value to what you do in the market.  This week, I have, totally alone in the gold community, have worked hard at "turning down the sell adrenaline" with most of you in silver.  I think I've been pretty successful at that job.  

6.   Whatever the general theme is in any market, you need to turn down the volume personally in terms of the attention you are paying to that theme, so you can act professionally with your buy and sell orders.

7.   Some of you watched Tanzanian Royalty, one of the juniors flying five, blast higher just 24 hrs after I said, "the chart is a drifting slug, but when the rise comes it could be explosive." Yesterday price did explode, driving into the upper keltner line on the chart.

8.   Click here now to view the TRE-amex chart.

9.    Note the huge volume bar and the red "book profits" button.  Buy the demoralization (yours), and "kachingo" the "it's gotta be goin' higher now FEELING", but do it with trading positions, not core!

10.          I'm trying to post more PGEN and HSR videos, to provide maximum clarity on handling these markets.

11.          Note that the silver monthly chart has been overbought for about 6 mths, basis the monthly chart RSI indicator.

12.          Note that the DOW was overbought for 18 months straight, and generally overbought for FIVE YEARS, from 1995 to 2000.  The question is not WHEN is silver going to correct, or should you short it now, but whether you can respond to silver when it does correct, and whether you can emotionally deal with the very real possibility of an institutional money panic in the world's paper currencies.

13.         That panic could send gold and silver higher in either an upside parabola, or an extended bull market that lasts for many more years, and maybe both!

14.          Click here now to view the wheat chart.

15.          What a horrific sell-off, and right on schedule. Wheat, based on the 40 year seasonal charts, tends to CRASH in the last week of April. 

16.          English language lesson time:  Is it a crash, or is it a sale, specially arranged for... YOU?!?

17.          Wheat has a 2/3 chance of rising to 11.50, and a 1/3 chance of falling to 4.50.   I think 4.50 is unlikely, but who knows.  I think wheat goes to $20 in time. 

18.          If you have no wheat, and you can't handle the futures markets, or simply have no access, then you need to look at either the London Stock Exchange "weat" ETC (exchange traded commodity), or look at something like the GRU-nyse grains ETN.

19.          ETNs are exchange traded NOTES, and carry more risk when the financial system is under stress(attack).  ETFs are funds, so investor money is safer.  ETCs are in the middle of ETNs and ETFs, in terms of risk.

20.          Jim Rogers has made several attempts to short the US T-bond.  He's trying again.  He hasn't really failed in his previous tries, but price has not melted away.

21.          I don't know if price is going to melt away anytime soon or not, but you need to be ready to buy after a multi-year decline, IF it happens. 

22.          Click here now to view a bond chart snip.  That is bear chart action.  The US dollar looks worse than the bond, but the bond is starting to play catch up.

23.          I've advised most of you not to short the bond, because when it does go south, it is likely to turn gold stocks into rocket ships heading higher.   

24.          Gold is stretching for $1540 as I send this off. The general mood remains lackadaisical.  The consolidation between 1310-1440 destroyed the public's interest in gold.  Gold could rise another $200-500 and the public couldn't care less, so....

IT LIKELY WILL DO SO!!!!!!!!!!!

Grid time!  Natural gas fans noted the pop upside on decent volume yesterday....  It's a positive, not a buy signal!  The futures markets are structurally stronger than the stock markets.  There is same day settlement versus 3 day settlement for stocks.  You can deposit T-bills with some brokers and use that like cash to trade. You get interest on your money.  Right now, there's no interest of size paid, so it's a waste of time.  That will change, and perhaps very significantly.

Thankyou.

Cheers,

St out!