Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 2% on the Week
By: Chris Mullen, Gold Seeker Report

Ira Epstein's Metals Video 11 17 2017
By: Ira Epstein

Next-Generation Crazy: The Fed Plans For The Coming Recession
By: John Rubino

COT Gold, Silver and US Dollar Index Report - November 17, 2017
By: GoldSeek.com

Gold Miners’ Q3’17 Fundamentals
By: Adam Hamilton, CPA

Bonfire of the Absurdities
By: John Mauldin

The Social Security Inflation Lag Calendar - Partial Indexing Part 1
By: Daniel R. Amerman, CFA

Rob From The Middle Class Economics
By: Gary Christenson

GoldSeek Radio Nugget: John Williams and Chris Waltzek
By: radio.GoldSeek.com

The Metals Market Is A Mess And Will Likely Continue To Frustrate You
By: Avi Gilburt

 
Search

GoldSeek Web

 
Gold And Silver – 2013, 2014, 2015…Expect More Of The Same.


 -- Published: Sunday, 4 January 2015 | Print  | Disqus 

By Michael Noonan

Each week, we prepare a selection of newsworthy events to which the current market can explained, somewhat. This week is no exception, save one difference, that being so many want to see/hear some kind of look into the prospects for the year ahead. Our look ahead starts with a rear view mirror look back at 2014. In hindsight, we began 2014 with a positive outlook, but that quickly changed into the view that 2014 could turn out to be just like 2013...no big rally. On that score, we were on point.

Before engaging in a review, we have abandoned providing any background news, this week, because for us, the most important news moving forward is found in the six charts that follow. If you are willing to accept the message the market is giving to everyone, you will understand the folly of those who opt to make price "predictions." Keep in mind, a good many of the experts with the largest followings were touting a price breakout by the end of 2014. None called for new recent lows, and if someone did, our apologies for not knowing who you are. Bottom line: predictions are a waste of time.

To the degree that new recent lows developed in 2014, we did not expect that event. This is a more forgiving "miss" because we were not advocating trading the market from the long side, on paper throughout 2014. Strong recommendations to buy physical gold and silver were a constant, on our part. While all purchases for the physical made during the year are higher than current prices, the buy recommendations were always qualified for reasons unrelated to the market trend being down.

Would we have held off recommendations to buy during 2014? In hindsight, yes, but we were not prescient enough to see lower lows by year-end. At the same time, we have zero misgivings for purchases made throughout the year just ended because the buys are made irrespective of current price and in anticipation of much higher prices at some point in the future. The purchases were not made for near-term profit, and we stated as much, each time.

China and Russia remain avid buyers of as much PM product is available. Check. Strong sales to the public remain for individual ounce coins. Check. The Obomba administration remains as the most destructive wrecking ball for much of the world, especially Iraq, Afghanistan, Libya, an attempt at Syria, and now its coup in Ukraine. Check. The US continues to demand and its subsidiary, the EU, continues to follow along with sanctions against Russia. Check. The Federal Reserve fiat "dollar" continues to lose status as the world's reserve currency. Check. Obomba continues to provoke Russia into some kind of military response in order to blame Russia for starting a war. Check.

It ain't working. There are so many stories to be told for each of the above situations, and even more compelling stories about how Russia has given the entire West and all its sanctions the "goldfinger." Credit to Putin for being the single most fighter against the elites and embarrassing them at their own [poorly played] game.

We do not know if this is a true quote, but Putin is said to have compared Obama to a pigeon playing chess against him: "He knocks over all the pieces, shits on the board, and then struts away as though he won." An apt summation.

Given the wealth of stories available, we choose to focus on the most compelling one as told by the charts. Keep in mind, when we say charts, they are a reflection of developing market activity that tells the most accurate and current story. It is not a promising one, as of the end of the year and heading into 2015, but it is reality, and to expect anything else will lead to the same disappointments of 2013 and 2014. Forget the ego-driven predictions that have all proven wrong again and again, and deal with what is.

To the monthly, we added annual and quarterly price activity. While most never look at a monthly chart, even fewer would ever look at a Quarterly or Annual chart, but they are substantive when looking at market direction. Why? It takes so much more time and effort to alter their course.

The annual shows a modestly lower close for 2014 over 2013. For this it can be said the downside momentum slowed, but there is no sign of change, yet.

After holding the 1200 area for 5 quarters, price finally gave way to the downside. As with the Annual, the range for Q4 of 2014 was relatively small, and the close was mid-range, an indication of some buying activity, even if only short covering. It has to start somewhere. Bottom line assessment is that there is no indication that the market is ready to turn around, at this point. What this means is to expect more work in the next few months, at a minimum, as price seeks a bottom where demand will take over.

The chart comment for the month gives our view at the end of Q3 which shows the value of paying attention to what the market's message is as determined by reading the charts.

Gold Monthly Chart

Most do not like to hear news that is not supportive of what they want to see happen. We are just as eager to want to see a strong rally, but those expectations are contrary to what the market is advertising. Consider just viewing the facts, as presented on the weekly, and then decide if it makes sense to expect a change in trend any time soon?

For review, the concept behind Bearish Spacing is when a swing high rally fails to reach the low of the last swing decline. It leaves a space, as shown by the two horizontal lines. What this means is sellers were sufficiently confident that lower prices would follow that they di not wait to see how the market would retest the last swing low. Obviously, it has a bearish connotation that should not be ignored.

The series of LHs, and another LL is a text-book example of a down trend. When you consider just these observable, undisputable facts, the reality of what to expect for the near term future cannot be in doubt, and it should put into perspective any "bullish" analysis as being significantly uninformed and very misleading.

When you look at these charts, you can better understand how all of the current event stories are not what is driving the market, a concept many find hard to accept.

Gold Weekly Chart

After declining from the last swing high to a recent low in just 13 TDs [Trading Days], the question to ask yourself is, how is the market responding? Well, 21 TDs later, 50% longer than it took to decline, price turned back lower. Is that a strong reaction or a weak one? When you ask these simple questions about what the market is doing, you actually get an immediate and accurate response. Price is struggling, and this is to be expected of a market in a down trend.

37 TDs after the last swing low, how is price responding? It is now only at the half-way mark and even lower than the 21 TD rally. The market message is very clear for those willing to observe what is.

Gold Daily Chart

The silver market has a lot of work to do before any kind of prospective turnaround can occur. Does it matter how great a shortage there may be for physical silver, for how great the demand is for this metal? Not according to what these charts are saying. Before this market can go up, it has to stop going down. Can it be any simpler, and can you see how relying on shortage statistics, et al, can be very misleading, at least as to timing?

Markets do not lie, and opinions do not matter.

Silver Monthly Chart

Same as for gold. Second verse same as the first.

Silver Weekly Chart

If you look at the Quarterly chart for silver above, prior to the last two Qrtly bars, price was unable to rally away from support. Axiom: weak rallies lead to lower prices. You see a similar price activity situation on the daily chart with price not rallying away from the 15.50 area. It may hold, we are not saying it cannot. When considering what price is likely to do from a probability perspective, it is more likely to give way, especially when viewed in light of the trend. It is just common sense.

Is this all disheartening? It should if one is willing to deal with what the market has to say and ignore any "expert advice" to the contrary. The reality of the underlying fundamentals will eventually prevail, and if only half of them are real, gold and silver will go to higher levels than ever seen previously. The market is simply saying to be patient.

We are as bullish on the potential of both of these markets as most. However, we are realists with the highest regard for what the market says and no one else. Expect more of the same for 2015, at least to start, until there is evidence of a market turn. For now, there is none.

http://edgetraderplus.com/

 


| Digg This Article
 -- Published: Sunday, 4 January 2015 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2017



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.