We Reached Ground Floor? Silver Takes Express Elevator Up (And Right Back Down) This Week
SD Friday Wrap: The fundamentals say silver is going up, and the technicals are quickly reaching the ground floor...
What a price swing!
Let's see here: From the low on Tuesday ($18.36) to the high on Wednesday ($19.75) we saw a 7.57% move up in price.
Wow!
Was the cartel really just gonna let that fly?
Nope!
So from the high on Wednesday ($19.75) to the low on Friday ($18.04) we saw an 8.65% move down in price.
Wow!
Here's what it looked like on the 5-minute chart:
Notice the post-jobs report pop today, and then notice how the cartel wasn't having any of that!
I guess we found out if the cartel is still in control or not, and it seems to me that for the time being, they are in control, and, at a very minimum, content with "selling" paper silver to smash price.
The only people who know for sure whether the cartel is still in control are the members of the cartel themselves, and since they are content making themselves fraudulently rich with their inside information and their US dollar printing press, don't get to thinking they're gonna broadcast the news when their control has been lost.
Nonetheless, everybody's out there justifying silver's price plunge.
Let's name a few of the reasons given:
The economy is rebounding, so the Fed won't cut rates.There has been a cease fire in the trade war with China.People are moving out of safety (bonds) and into risk assets (stocks).And there are those people who cling to the charts, saying, "the technicals are just too extreme, so get ready for the low $17's".
I'm not so sure.
I don't think silver stays down in price for long.
In fact, we may start moving higher again next week.
I was looking to overshoot $18.50 to the upside, and we did that, and I was also looking to consolidate at $18.50, which we are under right now, but I don't think we go much lower in price from here, and, quite frankly, the same people who scream the loudest about the technicals being too extreme are now looking at technicals that are quickly becoming neutral and supportive of the next leg higher.
Which means those same "traders" will be turning bullish by, say, oh, next week!
Silver is not for the faint of heart, or, as Egon said yesterday, "silver is not for widows and orphans".
In that sense, yes, in the short term, silver can whip-saw erratically and wildly, so if your time horizon is the short term, then losses may very well be in order.
Investors who are simply stacking physical silver to protect themselves from their rapidly devaluing fiat currency, no matter which fiat currency we are talking about, because all the world's currencies are unbacked debt-based notes, will be fine in the medium term and super-duper fine in the long run, and that is without even considering a global monetary reset, which we know can and does happen every few decades.
Are we nowhere near, are we due, or are we overdue for a global monetary reset right now?
I think we are overdue.
Regardless, silver is going higher in the long run, so if you are willing and able to get out of US dollars and into real money, it has become cheaper to do just that!
And in only two days!
It's a flash sale.
Woot!
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NOTE: THESE CHART WERE SET-UP AT APPROXIMATELY 10:35 A.M. AND DO NOT INCLUDE ANY PRICE ACTION THAT TOOK PLACE AFTER THAT TIME
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The gold-to-silver ratio has moved back up into the mid-80s:
That's another way of saying silver is on sale because of price weakness.
Here's silver's rollercoaster ride:
If the charts matter, then check out how quickly silver's RSI is coming back down from being too extreme!
As I have been saying for a couple of weeks now, I think the fundamentals have been exerting themselves onto the market and influencing the price action much more than the technicals have.
Gold is consolidating nicely between $1500 and $1550:
Since we overshot $1550 to the upside, yes, we could go under $1500 to the downside if we are truly having a "correction" here.
Platinum has punched through $1000:
Since platinum has joined the fear trade, I would not think we're heading back down into the low $800's, but then again, the cartel doesn't want the precious metals sending signals to the "market", and that includes any signals sent by platinum.
Palladium is within spitting distance of record highs:
We've been above the 50-day moving average ever since the break-out, so that's bullishly nice to see.
Crude oil is still in a very tight range:
I'm expecting an upside surprise in crude oil at any time.
I've been talking about copper carving out a bottom:
It looks like we found the bottom this very week.
President Trump's stock market is right back near all-time record highs:
We will probably get there too, you know, so the cartel can bring-in as many sheeple as possible just before the slaughter.
OK, "Hey Half Dollar, why are you calling it President Trump's stock market?".
Good question.
And I'm not.
Trump himself is calling the stock market "my stock market":
Of course, when you can print up as many dollars as you want, to your heart's content, the stock market could be wherever he wants it to be.
Until we return to honest money, that's the way it's going to be.
Unfortunately, before return to honest money, there is going to be economic misery and financial ruin coming to the United States.
It will be by design.
The VIX has been further suppressed this week:
The VIX is actually one of the easiest things to suppress.
If you're interested in knowing exactly why the VIX is one of the easiest things to manipulate, you should join us when we do our live-streams and call-in to ask that very question.
I like being put on the spot!
Pun intended?
I'm not sure.
Yield on the 10-Year Note spiked after putting-in fresh new 52-week lows:
Still, the Fed Funds Rate is a range, between 2.0% and 2.25%, with the actual rate generally pegged right smack dab in the middle of the range, which at current interest rate policy puts the actual rate at 2.125%, so yield on the 10-Year Note is still more than 50 basis points below the FFR!
Do people really think the Fed is not going to cut again in less than two weeks?
For now, the bond market is telling you the Fed will cut interest rates, and by more than 25 basis points this time.
The dollar index popped this week, but didn't break-out above 100:
Notice how quickly the DXY moved back below 98.5, as if it was being held in some sort of range?
Oh wait, it is being held in some sort of acceptable range, generally being 96 to 98 on the DXY.
What is the bottom line as we find ourselves here this beautiful first Friday of September?
Silver has been on one heck of a rollercoaster ride this week while gold consolidates.
I'm not concerned about the move in silver, and, if anything, it is an opportunity.
Because the cartel will cling on to paper control until the very bitter end.
New stackers can benefit from their price suppression schemes.
Older stackers, on the other hand, well, yeah, I feel for you.
This will go on and on until it can't go on any longer.
From $19.75 to the low $18's is quite the fall.
This is not the end of silver's run higher.
It is a simple "correction" in the price.
The smart money is buying now.
Buying on this "weakness".
Which is what we have.
Will it last for long?
I don't think so.
Nothing has.
Changed.
At all.
No.
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, an active 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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