What Now?

What an interesting seven weeks it's been. From the jubilation of late April to the frustration of early May to the despair of today, we've certainly ridden the trader rollercoaster.

I've tried to lead the way through the darkness but this sorcerer/soothsayer stuff is pretty challenging, particularly when you're dealing with a criminal enterprise on the other side of your trades. Regardless, let's recap so that we can begin to decide where to go from here.

First, back on May 18th I gave you what some began to call a "roadmap". Here's a link:


I'll be the first to admit that the silver prediction for June came up short. I was looking for a rebound to $42-43 based upon the same fundos that had driven silver since August. The fundos are undoubtedly still there but the buyers aren't. All of the C/C/C shenanigans have scared them away for now. Silver made it to 38.84 on 5/26 and 38.76 on 5/31 but that was it. The gold prediction turned out pretty well, however. I was looking for a June peak between 1560 and 1580 and we made it to 1559.30 yesterday. Here, then, are the salient points going forward:

"5) Having accomplished all of this by the end of June, the metals will enter their typical summer doldrums. Silver will have painted a double top on our "white out" chart. Gold will have a near perfect double top on its actual chart. The PMs will selloff through July and into August, just like they did in July and August of 2010 and then January and into February of this year. Gold will likely retrace all the way to $1450 or so. Silver will trade back down to this 33-35 area.

6) By this point in late summer, all will seem lost. Every two-bit technician and topcaller will be proclaiming the end of "The Great PM Rally", just like they did back in late January. But it won't be the end, it will be the start of a new beginning.

7) The metals will rally from late summer into December. Gold will trade to a peak near $1750. Silver will again trade near $50, this time for real."

Then, there's this, which I wrote on June 8:


In this post, we discussed how a rallying POSX might be the final nail-in-the-coffin for the gold rally from January. I hoped that it wouldn't be but I feared that it was. (Against my own advice, I bought those August gold calls Tuesday. Turd dumdum. "Walk in middle of road. Get squished like grape.") From this post, here is the most important point:

"The dollar rally has added to what was already a rather tenuous position for gold. Take a look at the chart below. If we again use the white-out to wipeout the blowoff from early May, we get a chart that made a top about five weeks ago, corrected down, moved back up and now has made an attempt at a "new high". Failing the new high, it instead has rolled over and is now pointing lower. I hope I'm wrong but it looks like we have found our range for the summer. It looks now like gold will trade between 1470 and 1550 for the foreseeable future. Do not despair, this pattern of four months UP and two months sideways has been going on for years in this bull market. This new range would just be a continuance of the pattern and it certainly is consistent with the "roadmap" I posted several weeks ago. I still believe that, by late summer, gold will finally break higher and rally toward a December high between 1700 and 1780."

So, how does this relate to today? To me, today's action was the final, crushing blow to the 5-month rally in gold and the hoped-for recovery in silver. I now have no doubt that Santa, Turk et al will be proven wrong over the summer. There will be no "explosive" summer rally that will "confound the experts" and "make contrarians money". The PMs will simply be in another 8-week consolidation phase as they prepare for the next 18-week rally, which should begin by late August/early September. Until then, my advice to you is to not play. If anything, take advantage of dips toward the lower end of the described ranges by adding and stacking your physical. You'll have several opportunities over the next 8 weeks or so to buy some physical on "sale". If greed convinces you to trade paper on the Comex, you will only find yourself in the end with less fiat than you started with and you're going to want as much fiat as possible in your warchest when the next major UP move begins.

I leave you for now with these words of wisdom that Santa emailed out earlier today. Relax. Be happy. Enjoy the summer. Be ready for fall.  TF

Dear Friends,
Economic statistics are taking a hard fall.
Without QE who will buy US treasury issues?
Without QE where is the basis of world equity markets?
Without QE what do you think the chart of unemployment will look like?
Without QE how do you think the camouflage of the insolvent balance sheets of the financial industry will fare?
Without QE where is mortgage money coming from?
Without QE what do you think home prices will do?
Without QE how will the present Administration and the legislative be re-elected?
Without QE how will the States of the United States of America finance themselves?
Be prepared for a reversal of the decision to curtail QE at the end of June.
Be prepared for a snap back at a greater percentage of QE with a different name.
Be prepared for covert QE between July 1st and late August when stimulation goes wild.
Be prepared for gold to take out $1650 on the upside as magnets at $12,544 come into play.
Be prepared for the Inflationary Depression of all time.
Stand firm on your gold positions.
Stand firm on your discipline of NO margin.
Stand strong in your Swiss Franc and Canadian dollar positions.
Survive the MOPE and market manipulation that is so obvious today.
Respectfully,  Santa





SilverTree's picture

Don't Stop Believin

Northern Border's picture

Nothing has changed

Ask yourself this question ? 

Has anything changed from when you got that first stack of eagles in your hands ?


Keep stacking and taking advantage of the discounted physical.  Were on the right side of history.  The question is, when the other 99% of the population finally realizes this, what happens next?

SilverTree's picture

Don't stop,


Don't stop, Stackin!

ScottJ's picture

I personally agree with

I personally agree with Santa, and that this is the head-fake before the move up.  It is not like they are going to show the world through TA one of the biggest spectacles in modern financial history (in significance as all gold prices push to new highs together).  They want the least amount of people on the train when it takes off, right?

R.I.P. Federal Reserve Note, 1971-2012

Sterling's picture



tmosley's picture

Five more weeks till D-Day.

Five more weeks till D-Day.  I wouldn't talk about much about "summer doldrums" until this COMEX inventory problem is resolved somehow.

These are historic times.  Paper will diverge from physical, and that paper will become worthless.  FAST.

Stay away from paper.  

TrollKiller's picture

Wealth will be measured in Ounces

Keep you powder dry.

Gold down in the last 3 days nearly $40, most of that in the last 24 hours.

And yet nothing has changed, do not despair it is a long way from here to September.  Control is a slippery thing even for the slippery.  Just when you think you have everything under control squish goes to squash and the technical analysis is left in the dust.

Never forget everything can change in a day and if it can drop $40 it can rise $80.

"Prediction is difficult, especially about the future."  Niels Bohr

Don't write off the rocket launch just because the bad guys have painted the chart, don't underestimate the Turk, or the General.

Be ready for the ignition.

Agophillic's picture

Keep on, keepin on

On top of stacking, I would say that if this economy is going to go into a lull, then it is a perfect time to be tucking away everything that you can.

I have moved away from bullion and have focused on junk 90.  I love the webiste www.coinflation.com for all of my pricing needs...90% is the most affordable way to keep stacking, and the best way to protect your purchasing power in lieu of the looming global currency crisis.

bullwhip29's picture

@ ScottJ

I am sticking with Santa and Turk too.

As much as I can respect what Turd has done (maintaining this blog undoubtedly takes up a lot of time), some of his calls have been so far off the mark (think 180') that I am beginning to wonder if his initial success can be attributed to nothing more than pure luck, plain and simple or perhaps this Pied Piper act we have now witnessed twice in two months is by design?  Sorry guys, my mind is wandering... More likely that not, he is not the one to blame as there are so moving parts to keep an eye on that it virtually impossible for anyone to make sense of what is going on and in recent posts he himself has acknowledged this. Say what you want, but telling us now that you have no clue what is going on is rather disappointing to say the least. Should we all be surprised by this? No. Are we fools to believe that some random guy on the net had it all figured out? Probably. Hey, I know that expressing my concerns about this NOW doesn't help anyone out either. In fact, it has the appearance of sour grapes, mindless bashing etc. but that is not my intent here. For what it's worth, I believe the best advice is he given us so far is quoted in today's post, "What Now?" and that is to NOT PLAY.

Good luck to all!

atlee's picture

just because the I am not on

just because the I am not on the train when it leaves the station, does that mean I can't buy immediately? Is there some rule that says if I am not on when it leaves the station I am shut out? Does that mean pay high for my ticket now rather than wait for a lower price with the risk that I MAY have to pay higher? I am still going for the ride to $2,000 when it happens.

Richard Booze's picture

Help me out here . . .

Hey, guys, I'm a newcomer, recently acquired a few coins of gold and silver to stack when I can.  Lucky for me I wandered on to the Watch Tower site, then here -- now a bonafide registered disciple of Mr. T. Ferguson.

I find the site to be very enlightening, though I stumble over all the acronyms you veterans take for granted.  Most common, EE and POSX.  See em all the time and have my ideas, but don't have a clue what they mean actually.

I'd like to request that you get off your high horses and spell the various words out for me.  But I know that dog won't hunt.

A great addition to this already great site would be an acronym dictionary.  If you like, call it Acronyms for Dummies.  I'm not proud.  I'll use it anyhow.

Thanks, T Ferguson, for an extraordinary and informative website.  Hey, I'm learning.  Soon I'll be able to lose as much of my life savings as anyone  here!!

speconomist's picture

A personal message from Santa

A personal message from Santa himself? Woah Turd, you really have good connections!

Rhinestone Cowboy's picture

@ Richard Booze

click on Turdisms at the top of the site and you'll have your answer. 

thecoloredsky's picture

RE: Richard Booze

Richard Booze.... no high horses here. Click "Turdisms" at the top to get definitions of acronyms. Glad you are around!

Puregold's picture


Hit the "turdisms" button at the top of the page. It'll be like turning on the lights.

Eric Original's picture

Looks like someone picked the wrong week to quit smoking...

It's also the wrong week to walk away from the metals, IMHO.

I Wazere's picture

@ Richard Booze on June 23, 2011 - 5:26pm.

I agree with you about the acronyms, especially the made up ones that no one else uses.

If a person is running a blog, and hopes to see increased participation from the public, at least write so that everyone can understand.

There likely is an acronym dictionary somewhere on site, but I'm certainly not going to refer to it for every blog post and every third comment.

Richard Booze's picture

I beg your pardon!

He didn't promise you a rose garden.

Bullwhip, I haven't seen anywhere on this site a promise to take you from rags to riches.  I'm here because it is an immediate source of reliable information.  As important, it is a supreme forum of others who are precious metal investors and buffs.  And, did I forget to mention, it's free.

You get the data here.  Do with it as you will.  Don't cry when you lose!

Better luck tomorrow.

Richard Booze's picture


Thanks much, Cowboy!  Should have known the answers were here somewhere.

A colossal help!!

magis00's picture

@ I Wazere -- Put Forth A Modicum of Effort

Hey Man, I know it's daunting when all of this PMs information is fresh to your eyes, but ain't nobody on here going to hand it all to you.  (and everyone goes through the growing pains in their own way, believe me)

If you want to understand, and prepare, and insulate yourself as best you can against what's coming . . . you'll have to take some initiative. 

And I don't think Señor Richard Booze took a swipe the way it appears you did - I think he asked where to find the dictionary that "is likely somewhere ... that you're not going to refer to."

Not the best hustle, so far, but best of luck to you amigo.


Spinny's picture

Today is the

Today is the maddest/discouraged I have been yet since I started trading. The shittiest news possible comes out, our economy is going down the shitter and the markets ralley. I feel like throwing my hands in the air and giving up.

What will make equities come down? Anyone? Will they fall next week. Should I cut my big losses and get out now only to watch everything plunge? Someone please help a young trader out. My emotions are getting to me and I'm doing stupid things.

I am short the russel 2000. And expect to get killed again tomorrow since it is rebalancing day. I guess the means since I am sure it will go up it will probably tank. Which is why Im still in. I don't know up from down anymore. Nothing makes sense. When will gravity take over again????

zenith191's picture

Silver is not gold.

Silver is not gold. Forget silver. Central banks hold gold, not silver. There is no silver shortage. Comex represents a fraction of the silver market. The silver is being transferred out of the Comex and stored in London so it looks like there is a shortage. JPM is actually long silver, not short it. You cannot see all their books. They are fooling you.

GSFL's picture

Wrong, wrong, wrong

There is absolutely no use in trying to call this market at this time. Technical analysis will fail, fundamentals will fail, and those who try will fail. Too much happening too fast and too far reaching. Corruption, collusion, fear and greed have gone wild and it's every crook for himself.

I am going to watch, pick my spots, and let the market give me what it will. Over the last couple of days I have made some good money playing small and quick, taking the gains and adding to my cores.

As Santa has stated, nothing has changed. Stop worrying about today and prepare for tomorrow because we all know where this is going.

SilverDosed's picture


Thanks for the discount on my silver today big brother. Picked up some pretty cool stuff, a couple fat 20 crown pieces, some peace and morgan dollars, and my favorite of all coins, a big stack of Maria Theresa Thalers. Still saving plenty of dry powder though. I'd love the shorts to get it down below 33 and then the mother of all short squeezes right behind it, a short squeeze that makes april look sideways. Do I think its actually gonna happen? Probably not, but I always save a little dry powder just in case.

A warning I got from my coin guy today, he said state and local LEO have been told to crack down on tax-free bullion. It is apparently illegal to buy silver bullion online and have it shipped to you without paying state taxes. How are they gonna enforce this, I dont know, but he was given a stern warning not to sell silver for cash without charging tax. Then he sold me silver for cash without charging tax, lulz. I dont know if this means anything but felt like it was worth sharing.

Sterling's picture

Do not feed the troll

Do not feed the troll

kliguy38's picture


I hold a large basket of Miners. and follow some closer than others for technical signs of life. Most of these positions were zeroed out a few months ago after the jan feb run up...now I am finally back into some of my favs. ANV is one I follow and noticed a big volume turn at the recent bottom with large green follow up candles. GPL is interesting in that it is above its 50 and held today. I'm seeing higher higs in several with big boyz coming back in. It could be a choppy trade this summer but I am very suspicious we MAY have seen the bottom in miners ....Watch the $HUI for higher highs and higher lows....there are a number of inverse HnS formations in many of these miners so gl to you if you are playing them.

ginger's picture

Why has everyone assumed that

Why has everyone assumed that the only way to play this is short term? Whether or not TF is right or Santa and Turk are right about the shorter term, they ALL seem to agree about the longer term out 6 months from now. ...I'm confused as to why we all aren't enthusiastic about long NTM calls in gold & silver. As my buddy kumanari has told me more than once 'Buy time right now...you won't regret it'.

With his words ringing in my ears the past several days I went long on some UXG Nov11 7.50 calls. I'm not sure this was long enough however and am thinking of going for some Jan12 or longer UXG.

Which brings me to my 2nd point here. Is there currently an ongoing discussion in any of the forums for options traders? I've looked around but haven't stumbled on it yet. I would really love to brainstorm some good potential miner call options. OldNavy spoke of this some weeks back in a discussion about what to buy when SLV call options no longer seemed to be a good bet. I haven't seen OldNavy around though (I miss him!). ......Anyone got any good ideas for silver/gold miner call options they want to share...or direct me to a forum thread? EGO? EXK? UXG? GPL? ....heck.. just about any of the good solid miners might be a good bet for calls.cheeky

Exergy's picture

Summer Time Summer Time

Let's recap what we do know:

The Bull trends for precious metals are intact.

The Bear Trend is intact for the USD/POSX.

Inflation is rising but currently is under-reported in the USA but clear, present and substantial in the rest of the ENTIRE world except for maybe Canada that saw it's currency rise 25% in the last 2 years muting the effects until now (but watches it's currency rise/fall a penny for every $10 change in the price of oil).

What we don't know is what the EE,Cartel,Banksters,Boyz plans for the next few weeks... basically what I hear Turd saying that that short term pattern's are broken and there is too much chaotic activity to sense short term trends to reliably trade off of them.

so what.....

Buy unleverged physical on any dips... prepare for an explosive summer... but hope for a dull one.

Remember the rules of the Bankster game are to take away your gold and silver bullion and stocks and get you to think they are  not valuable when they and the rest of their commodity cousins are the only thing that are valuable because they are real.  (forget land at this point in most areas)...

Gold and Silver function in a special way in that you can by bushels of wheat for Gold or Silver..but not Gold and Silver with bushels of wheat....YET.

The ECB is leveraged so badly that a 4.25% haircut on their "assets" would wipe out ALL their capital.  Ireland just had a default event, Greece CAN'T pay their bills even if they get the loans, Spains real estate assets look like Japan's 15 years ago when the Emperor"s palace was valued at more than the entire value of all the real estate in the USA...Portugal ditto and now Belgium says half their sovereign gold reserves have been leased out.  The hidden question in this great game of "economic bugger your neighbour" is just who has a Credit Default Swap for what and backed by whom...kinda like not knowing who has AID's and who has a rubber while at a swinger's resort and you can"t find out unless they tell you or until AFTER you do the deed... (sorry could not resist that even though it's really bad)

The Fed is leveraged so badly that it would only take a 2.5% haircut on their assets to wipe out all their capital.

Both are holding "assets" that are marked to market so clearly they must be worth what the book says ...right.  plus Fannie, Freddie, AIG, GM, Toxic paper,  600B out to foreign banks under  Qe2 etc etc.

China has liquidity problems and India is overheating.

For all our sakes...I hope it's a dull summer and we can enjoy some fun in the sun before this house of cards collapses from all the shaking going on!

The game here is to survive first... get wealthy second.

Let's all look around the dinner table tonight and be thankful we are still in the game and remind ourselves WE are the 1% that are preparing!

awaecha's picture


    Santa's Angel of 1521 is HOLDING, Gold Miners look the best they have in weeks.

Monedas's picture

No Summer Doldrums ! Think Summer Trade Winds !

In 40 years of modest hoarding.......I've never heard so much buzz about the PM's ! The world financial predicament has never been so obvious ! I hear from new converts everyday ! I'm excited ! I feel like the spot light is on us hoarders ! The Hunt brothers never got this much attention ! Victory is here......I can taste it ! Rejoice ! I smell the vegetation of the promised land, the coconuts, the girls in grass skirts, the rustle of the palm fronds swaying in the Summer Trade Winds ! Monedas 2011

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