I think we get a pause today. with the jobs number out and the long weekend, its going to be too easy for the Cartel to slam gold and silver. However I cannot believe that this takedown attempt will last. September is the strongest month for the metals, and the buying pressure lately has been very good to take us right back up after any dips.
Here is what I wrote yesterday in Le Met, and I think today is playing out exactly as I expected:
Hi Bill!
I am pleased with the trading action in the PM sector lately. A small
handful of advisers remain staunchly bullish on gold and silver, and
the usual suspects are warning that the rising metals are a bull trap
with bearish implications. Things are normal in other words. I will
leave the trading advice to others more qualified than myself, but I
do hope we see a flat to slightly lower spot regime for gold and
silver until after the long weekend. For things to simmer down and
consolidate gains before plowing ahead to establish new highs for gold
and silver would be an ideal case. Keep the GATA gold and silver
rockets out of the picture for a bit longer!
We may still have a takedown is in the cards for tomorrow, ahead of
the thin trading prior to the long weekend. Veteran observers in this
market know this is a usual tactic of the Cartel. Silver has commonly
been the lightweight that is pushed around to bully the sector lower.
During the last couple of weeks however silver has been showing
surprising strength. As others have pointed out, I suspect this is
due to supply issues and a cascade of paper futures dumped in the
market will probably not be enough to trigger a sustained selloff in
either metal.
Perhaps we will get a spike lower tomorrow, with associated weakness
in the gold and silver stocks. If so, I am expecting it will be a
very short raid, and will represent an ideal time to step up and do
some buying ahead of the next upside move. Today I sold a small chunk
of some of my larger holdings, and raised some cash to be a more
aggressive buyer on the dip if we get one tomorrow. I was buying the
hell out of the many bargains available in July and August, and I
still think the window is open to buy weakness, but my expectations
for the next couple of months are for much higher prices across the PM
sector. I will not say this is last call, but if I am right in my
outlook, things are about to become much more exciting for the mining
stocks.
Unlike years past, the silver buyers in recent weeks seem to be
waiting for the Cartel to make their move, and then stepping up to
seize any discount. The new buyers also seem to be much more willing
to hold positions and have not buckled under the pressure of Cartel
raids. So it may well be silver that leads the sector higher in the
next wave, even with gold sitting just below achieving new all-time
highs.
Those who cashed out for the summer months, or who may have become
discouraged and moved elsewhere to invest, I expect we will see again
shortly with a flow of new money back into the entire PM sector. Lets
see how this plays out...
Cheers!
Mexico Mike
www.smartinvestment.ca |
