Fri, Jul 22, 2011 - 10:21pm

Just two simple charts for you to chew on over the weekend. I'll be unavailable for a couple of days as I'm headed to where the streets have no name. It'll be a sort of homecoming for me in the city of blinding lights, out there in God's country, where the land is often as white as snow. This time of year, however, it should be a couple of beautiful days.

First up, here's a weekly silver. As you can see, the uptrend from 2010 appears to be firmly intact. This chart confirms for me, however, that silver, above 40, will encounter some resistance around 42 to 42.50. It won't be the end of the world but there may be a period of a few weeks where gold will outperform. Ah...silver and gold. What a pair! Two hearts that beat as one!

Gold, on the other hand, looks magnificent...almost like staring at the sun. Gold may often seem to move in mysterious ways but, in fact, it moves with grace. Once you realize that the goal of The Cartel is to manage its ascent, you can begin to see, and rely upon, repeating patterns. The most grand of patterns is evident on the chart below:

The pattern above is not just the real thing, it's even better than the real thing. Note how, since 2009, gold has followed a six-month pattern of, roughly, 20 weeks UP followed by 6 weeks down. It may appear out of control but it is, in fact, the sweetest thing. Gold is now clearly into its next 20 week UP cycle. Following pattern, we should expect a mid-November high, somewhere in the neighborhood of $1800. Not bad.

That's it for now. I must walk on with or without you. I hope you have a great weekend though of course, some days are better than others. This is my exit but I'll be back in three sunrises. TF

About the Author

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Jul 24, 2011 - 8:08pm

POSX Dropping

It should start dropping now that the hong kong markets opened up. It hung in there pretty good for the last 4 hours or so.

Jul 24, 2011 - 8:05pm


Did not intend to mislead. Sold when GC was 1624. Actually got 1623.56.

Jul 24, 2011 - 7:59pm


Nice job $1624, I actually thought about locking to sell around there [I was showing $1622]. I am thinking we will will see that number again after midnight, so I am holding out to sell for a bit longer. I sold a pretty good amount at $1602 earlier in the week, this is tapping in to my 'keep pile' now so I am waiting for a pretty sweet bump.

Likewise, if for some reason silver starts catching up tonight I sell some there too.

Good luck!

debtlessFerd Torgerson
Jul 24, 2011 - 7:58pm

After the October 2008 fall

After the October 2008 fall in everything - the S/G ratio was 80/1.

That was THE time to buy silver. $9 / oz. in the near past.

Over the past year it has fallen as low as 32.x / 1 - That was the best time to trade silver FOR gold. We have been hovering @ 40/1 for some months now.

¤Ferd Torgerson
Jul 24, 2011 - 7:55pm

Same thing with the gold/oil

Same thing with the gold/oil ratio, 16:1 for the most part.

H'mm, now where have we heard that ratio before...?

Ferd Torgerson
Jul 24, 2011 - 7:53pm

Amazing equilibrium between Gold and Silver (see G/S Ratio)

I've been hearing that the current G/S ratio stays at about 40. One is to buy silver when it is well above 40 and buy gold when it is well below 40. For the past several days, the G/S ratio has stayed within basis points of 40. A moment ago, the ratio was 39.99. Then moved to 40.01.

Even on an evening of stress and disruption, it is amazing how closely these two are staying.

We'll see if this keeps up.


Jul 24, 2011 - 7:53pm

EE or algo's?

Yes, never underestimate the EE.

They've made it this far from 1913 on the system they devised. Pretty friggin' ingenious even if it's diabolical by them. Respect and know thy enemy.

I think the action right now is the algo's digesting the price levels that were breached, adjusting to the selling at those levels and then were onto the next level up after the markets are open at 8:00 p.m.

Midnight or so should be interesting.

Jul 24, 2011 - 7:30pm

Trading is Just Guessing

So true these days.

I just guessed that it was time to take profits on 20% of my gold @ 1624

Likely a dumb move but I have learned not to underestimate the power of the EE.

Jul 24, 2011 - 7:23pm

Addition to this evening's soundtrack

Slightly OT, though not entirely -- thought this was a nice backdrop to a Sunday evening beer as we watch the current episode of the Fiat Soap Opera -- F**k the Fed by Neal Fox (pretty sure this came from the 'What are you listening to right now' thread):

F**K The Fed - From the Award-Winning "The CONSPIRACY Project"
Jul 24, 2011 - 7:13pm

Wow, this is really amazing.

Wow, this is really amazing. Gold usually opens quietly on Sunday night, but this time it looks the markets opening is the equivalent of releasing a pressure valve. I think probably this is as a result of a combination of markets starting to open with no deal, and what the previous poster said about Bill Daley's comments - in other words, "stressful days" ahead. It does seem like the EE is starting to beat back the rally (probably because they were caught with their figurative pants down) but this is an ominous sign the coming week. I figured we'd have to wait until September for gold $1700... now I wonder if we might see it in the next two weeks.

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