$1800 Gold Holds, And A New Major Sign The Cartel Is In Big Trouble With Silver
Think gold's set for a dramatic pullback from $1800? Maybe not. Here's why, and here's something big that could be signaling the cartel's in big trouble...
It looks like $1800 gold is holding to finish the week.
Of course, if one likes his gold like he likes his women, real, and one wants to actually buy one ounce of gold, one'll be paying more than 1800 bucks, but by now everybody should understand that the price we see on the screen is becoming more and more disconnected with the reality we experience on the streets.
Real, physical gold, in-hand, costs more than 1800 bucks.
Which brings me to the first point I want to make about gold on the up-coming dreaded "pullback".
I keep reading articles talking about how there is just too much extremely bullish sentiment in gold right now, and the argument generally goes that we're in for pullback based on the sheer extremeness in bullish sentiment.
I must say, however, that in my opinion, when we exclude the Twitter & MSM sheeple from the mix, and especially those who say "look at gold" yet own nary an ounce, sentiment in the gold "market" is currently well-balanced, or perhaps skewed to a slightly bearish sentiment overall.
So sure, I'll play contrarian to the contrarians and say that when excluding the Twitter & MSM sheeple, and when including smart technical analysts (bless their hearts) who've been getting a lot of heat lately for being bearish (and wrong) in the short-term, I think sentiment is too pessimistic right now.
Besides, even if we get that dreaded "pullback" from here, and the yellow metal falls to a 16-handle, which some are pointing to in their charts, good luck trying to find any at that price!
Here's the next point, and I'll ask it as a question: With all of the gold supply chain disruptions we've seen in the first half of the year, including mine closures, refinery closures, mint closures, logistics problems, the 83-ton fake gold scandal and more, why would the cartel risk pounding gold back down to a 16-handle?
I don't think they would risk it.
If anything, they'd be looking to give us a sideways, possibly choppy channel of pure agony.
But I don't think they'll be able too to that either.
What I said on Wednesday is even more relevant today:
Making matters worse (or better if you're a stock owning Deep State Globalist on Wall Street or in Washington), I read today the Fed now has Apple, Walt Disney and Ford in its bond portfolio.
This is wrong on so many levels, but I'll leave it at that.
Gold has been bid, gold is bid, and gold will remain bid.
This does not mean to totally rule out the dreaded pullback, however.
Indeed, the cartel may risk it, and they may risk it for a few reasons, such as:
They've already lost control of the gold market anyway.They're ready to be done with the gold futures "market".They're about to make one last, massive purchase for themselves and their bestest buddies on Wall Street and in Washington.But I doubt it.
So we'll see.
Here's something else to ponder: People like to say that one ounce of gold will, as it always has, buy a men's fine suit, and if that is true, then gold is still undervalued right now at eighteen-hundred bucks an ounce.
Additionally, we've had days in recent years past where the price of gold popped by $100.
I'm specifically referring to the day of the Brexit Vote in June of 2016, and we all know how crazy the movement in gold was on election night in the US in November of that same year.
I think we're overdue for one of those days, and here's the thing to know about those days: There's always some trigger.
Could something happen this weekend that triggers a $100 pop in the price of gold?
Indeed.
Notice too, the shift in the mainstream media over the last couple of weeks from the riots and the protests to the supposed surge in coronavirus cases & deaths along with the increase in fear-mongering in general.
If the Deep State Globalists have a little shock-and-awe planned for this weekend, that's just another reason the dreaded pullback may not start from $1800 but from a price that's much higher.
OK, "Hey Half Dollar, yeah, yeah, we know, we know, get ready for a false flag of mass destruction and gold's goin' to the moon, we got that, but what we really came to know is what in the heck is goin' on with silver, Mr. I'm-No-Good-At-Writing-And-Can't-Really-Even-Clickbait!".
Um, yeah.
Right.
'Bout that problem.
I can't wait to see where it leads!
The cartel's problem in the silver market, that is, because everybody knows 'Ol Half Dollar ain't no dang Graphical Designer, much less a Coherent Author.
Here's the problem: Silver mine supply is dramatically down in what is arguably the two most important silver producing countries, Mexico and Peru, at a time when silver investment demand is up big-time.
Said differently, if we assume that silver flows in a "just-in-time" inventory system, and I do assume that, then there have been disruptions in the supply chain at the same time we have an increase in demand.
If investment silver is in strong hands, which I think it is, because the final capitulations happened in 2015 and 2017, no stacker in his or her right mind is selling his or her silver at twenty stinkin' bucks an ounce if he or she doesn't have too.
And since Silver Bugs are arguably the smartest people out there, they won't need to sell their stack out of sheer desperation, but rather, they'll adapt and learn to survive in this new economy while maintaining the majority of their stack.
But I digress.
Back to the topic of the cartel being in big trouble with silver.
What's the clue?
Copper.
That's what.
Check out that surge in the price of copper today:
Yes, that's a break-out to 52-week highs.
Yes, copper's technicals are screaming "extremely overbought".
Regardless, most of the silver production in the world comes in the form of bi-product from the mining of base metals, including copper, so by ramping up the price of copper, which is now up close to 50% from the spike low, copper miners are going to be financially motivated to mine more copper, and as such, more silver will come to market as a result.
But wait, there's more!
That's right, and it comes in the form of a shameless plug!
On Tuesday, Rob Kirby said one of his dealer contacts was having trouble sourcing 1000-ounce bars, saying there is a shortage of silver at the wholesale level.
Watch that interview in its entirety right here:
Thank you for your consideration!
So let's connect the dots: Silver production from mine supply has been down significantly over the last few months, there's anecdotally a shortage of silver at the wholesale level, and the price of copper is surging despite the fact that everybody is saying this is not a global recession but a global depression.
So, yeah.
It seems like the cartel has a major problem with silver.
But wait, there's more again!
That's right, and it comes in the form of food for thought: If it is true that central banks and governments around the world are printing like mad, and if it's true that, as they say, "that money must go somewhere", then it would be safe to say that some of this money is being used to scoop up real stuff, real stuff like, oh, something so precious that not even everybody on Earth could have an ounce of it if they wanted, silver.
Whose price is under twenty bucks in mid-2020?
Oh my!
Finally, all of this does not even take into consideration any "infrastructure spends" that would require a crap-ton of silver.
We should see more movement on a new fiscal package.
We see the very little movement in the price of crude oil:
It does look like we're rolling over here, so for the practical reason of wondering if the economy is beginning to recover or if the economy is still collapsing, the price of crude oil will be important to watch as one possible indicator for our understanding.
The stock market is still at all-time record highs:
Is the most-hated stock market rally of all time all totally about Robinhood traders as Zero Hedge wants us to believe, or are heavy hands in there forcing the movements one way or another?
I think it's the latter, but then again, I'm never getting invited to the rigging, and I would only go for reasons of sabotage if I ever was, so there's that.
OK, "Hey Half Dollar, are you sayin' 'who cares' what you think?".
I think?
Hmm.
Traders and investors out there think there's not a single thing to fear in the "market":
Fed's got their backs?
Zero-point-six it is:
We actually fell below 0.6 percent today.
And the stock market isn't even crashing!
Which means we may be talking about "zero-point-three" if they decide to take the Robinhooders to the cleaners like they did the Bitcoin Fanboys in 2018.
Do the Robinhood traders actually think they're going to get to be the new rich and powerful in society?
They're not.
They're only sheep, and sheep get slaughtered.
It'll be ugly.
If I read one more headline about the "death cross" in the US dollar index, I'm going to throw-up a little bit in my mouth for the second time:
It's the second one in the last year for cryin' out loud, and really, we're long overdue for something shocking in the currency markets anyway.
Palladium's clawing its way back above its 200-day moving average:
Barely.
Although platinum is the one that looks like it may actually be next in line to steal the show:
After all, we're still down significantly, year-to-date, and if the cartel lets platinum steal the show, they could momentarily get the eyeballs off of silver.
If only for a fleeting moment:
Silver's technicals aren't screaming "imminent plunge", and we do have that big, beautiful golden cross that probably secretly has Peter Brandt all giddy inside.
The gold-to-silver ratio is falling, albeit very slowly:
That said, gold holding $1800 is important, and if silver's poised to really move, then we could be under 90 in the ratio in a heartbeat.
Yes, silver performed well this week, but I was actually expecting the white metal to perform even better.
It will.
It's a question of when?
While I don't know when, I do know this: The longer the cartel waits, the more shocking the move will be as silver not only catches up with gold but catches up with itself.
Gold has showed us, again this week, why it's the granddaddy:
Gold knows what's up.
It's not good.
At all.
No.
Bottom line as we find ourselves here this beautiful Friday in early July?
If you filter out the noise, and get a feel for the market, it's bearish.
Which is exactly why I'm bullish about gold right now, still.
Are the fancy sentiment indicators reliable right now?
I'm not so sure that they are with so much rigging.
And for the many other reasons argued today.
Gold may not be set to drop but to spike.
Either way, if you're not a gambler.
Then it doesn't really matter.
What matters is price.
For real physical.
In the hand.
For gold.
Silver?
Too.
Stack accordingly...
- Half Dollar
 | About the Author U.S. Army Iraq War Combat Veteran Paul "Half Dollar" Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, a former amateur trader, and a Silver Bug at heart. Paul's free book Gold & Silver 2.0: Tales from the Crypto can be found in the usual places like Amazon, Apple iBooks & Google Play, or online at PaulEberhart.com. Paul's Twitter is @Paul_Eberhart. |
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