Riding The Line
As expected, prices have begun the week weak. Remember, that's OK. We are simply "riding the line".
That gold has slipped back below $1290 this morning should come as no surprise. We discussed this late last week and again on Saturday. That silver is falling toward $20 is also no surprise. We've been expecting that, too.
Again, over the course of the next week, gold will be working its way into and through the blue oval on the chart below. What I expect is continued support as it "rides the line". There may even be some intra-day drops below the line, below $1280 and toward $1270. However, as we move into next week and the middle to late stages of this month, I expect price to turn, having used the main trendline -- that had been resistance -- as support, instead.
Bolstering my confidence is the ongoing drop in GOFO which, after being positive in the one month rate for 53 consecutive days going back to May 20, has slipped into negative territory again today. It has fallen quite quickly, as a matter of fact. Just one week ago today it was +0.104%! The two-month and three-month rates are falling fast, too. Again, this is hardly surprising given that August is a Comex delivery month and it clearly means that readily-leasable gold is in short supply again. This will inhibit The Cartel Banks' ability to raid and suppress price and is one of the factors that will cause gold to reverse over the next few days.
Last week, we also discussed how silver, having broken down through $20.60, didn't really have much support until down near $20. So now here we are, at $20.23. As gold rides the line and slides lower this week, expect silver to drop, as well. However, my main support/buy zone is between $19.80 and $20.20. This is what I've been waiting for and I'm going to get it this week. As you can see, though, even a drop to $20 won't take silver down and back below its main, primary 2014 trendline. So, I expect it to reverse with gold, sometime very soon.
And many of you have been watching the HUI and waiting for it to fall far enough to close the gap on the chart from June 19. Well, your wait is almost over! Expect strong support in the black rectangle of the gap and around the 100-day moving average. Watch for the momentum trends to flip and then you can feel confident about another leg UP in the miners. Note that this, too, coincides with gold and silver needing about one more week of churn before turning higher.
The latest Coin Contest concluded last Wednesday. It was a very competitive contest and their were several of you who made outstanding guesses. However, there can only be two winners and they are:
GOLD: Low tick was $1287.50 on 7/24. "Saratogaprepper" guessed $1287.59.
SILVER: Low tick was $20.35 on 7/24 and 7/25. "Blackshook" and "08GoldWing" both guessed $20.33. The winner by virtue of the HUI toebreaker was "Blackshook".
Saratogaprepper and Blackshook, please email me your shipping info at tfmetalsreport at gmail dot com and I will pass it along to the good folks at JMBullion, who provided the prizes for this contest. Again, please be sure to keep them in mind for all your bullion needs! http://www.jmbullion.com
Finally, please let this serve as your first reminder...
Next week, we celebrate our first anniversary of "The Vault". This means that quite a few of you will be up for annual renewals of your subscription. This is set up to occur automatically so, if you do not wish to remain a member or if you wish to switch to monthly, you need to go in and cancel your current subscription before August 14. You can do so by accessing your profile page and clicking the "subscription" tab. I'll try to remind you all of this again later this week.
OK, that's all for today. There won't be a podcast later but, good Lord willing, we will return to a regular and full schedule tomorrow.