Gold & Silver Hunkered Down In The Trenches And Hoping For A Quiet Week

It's hard to see gold & silver being drawn out into no-man's land, much less going on...

(by Half Dollar) The term "trench warfare" comes up in market talk from time to time to describe a certain type of stalemate, a certain type of being stuck, where neither the bulls nor the bears are making any real progress towards achieving their objectives.

The term "no-man's land" also comes up in market talk from time to time to describe the dangerous, ugly area of trading-account instant death that's found between the trenches of the well dug-in bulls and bears.

If we had real markets with actual price discovery, I'd say those two terms apply to the current situation in the gold & silver market.

And because of these two dynamics, sometimes in the markets, the best action to take is to take no action at all:

Because prior advances have been lost, and most recently, gold and especially silver have even given up some ground, so any action taken right now likely includes a high probability of failure.

That is to say, the problem now is the weakened bulls don't see a lot of ground to be gained by going on the offensive, which would include a trip into no-man's land, and pushing gold & silver back even further could inflict catastrophic losses on the over-confident bears, and that could change the tide of war.

Furthermore, with not much so-called "market moving" data being released this week, like the CPI Inflation Report that was released last week, and with the Fed maintaining radio silence this week, as per tradition, since we're one week prior to the Fed's next formal FOMC meeting, suffice it to say that I wouldn't be looking for a whole lot of action from either side as the motivations for market movement are simply not there.

Instead, all things considered, including the fact that they could simply nuke our trench into oblivion at any given moment, I would be looking for some reassessing and some regrouping this week.

Patience is a virtue?

More like patience will be tested...